This story was originally intended to be published on
3/6/2012.
TIDMUBI
RNS Number : 7346Y
Ubisense Group PLC
06 March 2012
Ubisense Group plc ("Ubisense" or "the Group")
Unaudited results for the year ended 31 December 2011
Ubisense Group plc (AIM: UBI, "Ubisense" "the Group"), the
market-leading location solutions company, has announced its
preliminary results for the year ended 31 December 2011.
Financial
highlights * Revenue increased 34.4% to GBP23.8 million (2010:
GBP17.7 million)
* Gross Margin up from 33.5% to 35.6%
* Adjusted EBITDA* increased 39.1% to GBP1.4 million
(2010: GBP1.0 million)
* Adjusted operating profit, excluding AIM admission
and acquisition costs, increased 6.0% to GBP0.7
million (2010: GBP0.6 million); reported operating
profit of GBP0.3 million (2010: GBP0.6 million)
* Adjusted diluted EPS** 5.5p (2010: 5.7p). EPS 0.2p
(2010:3.3p)
* Net cash of GBP6.0 million (2010: GBP3.5 million)
================= ================================================================
Other highlights
* Substantially oversubscribed initial public offering
on AIM, raising GBP5.0 million before expenses for
the Group and GBP3.7 million for selling shareholders
* Substantial new contracts with Automotive and Energy
customers
* Global license agreements with BMW and EADS,
deepening existing long term customer relationships
* Increased R&D spend as Geospatial division commences
product development
* Two acquisitions completed, integrated and performing
in line with expectations
================= ================================================================
Richard Green, Chief Executive, commented,
"2011 was a tremendous year in our history, with the listing on
AIM, two Geospatial acquisitions and further endorsement of our
Real Time Location Solutions by new customers such as Eurocopter,
Toyota and Hyundai. We have also entered into global licence
agreements with both BMW and EADS during the year.
We continue to gain momentum with RTLS in the automotive and
aerospace sectors, and have also secured significant contract wins
in the energy sector in the second half of the year, both for our
Real-Time Location and Geospatial Solutions.
We start 2012 with a record order book and expect 2012 to be
another strong year for Ubisense."
* Measured as operating profit excluding depreciation,
amortisation, share-based payments charge, AIM listing expenses and
acquisition costs
** Earnings measured as profit for the period excluding
amortisation, share-based payments charge, AIM listing expenses and
acquisition costs
Highlights
-----------
Enquiries:
Ubisense www.ubisense.net Tel: +44 (0) 1223
535 170
Richard Green, Chief Executive Officer
Gordon Campbell, Chief Financial Officer
FTI Consulting Tel: +44 (0) 20 7831
3113
James Melville-Ross / Jon Snowball
Canaccord Genuity Limited Tel: +44 (0) 20 7050
6500
Nominated Advisor and Broker
Simon Bridges / Henry Fitzgerald-O'Connor
Note to editors
Ubisense is the market-leading location solutions company,
delivering mission-critical enterprise asset tracking and
geospatial systems that bring visibility and control to previously
intractable business processes. The Group operates in two
divisions, RTLS and Geospatial.
Through its RTLS division, Ubisense is a world leader in
real-time location solutions allowing companies to track assets
(such as tools, people and vehicles) within factories and other
indoor environments in real time in three dimensions. Ubisense's
end-to-end RTLS solutions provide dynamic and precise indoor
tracking of assets helping its clients, which are primarily in the
automotive, aerospace and transportation industries, to bring
visibility and control to business processes thereby helping to
lower costs and drive logistical efficiencies.
The Geospatial division uses Ubisense's expertise in location
solutions to help large infrastructure companies, such as utilities
and telecom companies, to map, plan, manage and optimise their
networks across large geographic areas. Ubisense is headquartered
in Cambridge, UK, and has offices in the USA, Canada, France,
Germany, Singapore and Korea. For more information please visit:
www.ubisense.net
Chairman's statement
---------------------
Introduction
It has been a year of remarkable progress for Ubisense. Since
the IPO in June 2011, the Group has shown solid forward momentum to
deliver a strong financial performance at our maiden full year
results as a listed company.
Overview
The Board is very pleased with the performance for the financial
year ended December 31 2011, where Group revenue grew by 34.4% to
GBP23.8 million and we achieved an operating profit, excluding AIM
admission and acquisition costs, of GBP0.7 million. Gross Profit
increased from GBP5.9 million to GBP8.5 million, representing an
improvement in Gross Margin from 33.5% to 35.6%.
We delivered adjusted EBITDA of GBP1.4 million, while adjusted
diluted EPS for FY 2011 is 5.5p from 5.7p in FY 2010. The Group has
also ended the year with a healthy net cash figure of GBP6.0
million.
We saw a strong performance from both of our operating
divisions. RTLS and Geospatial achieved considerable growth and
displayed momentum which we expect to continue into 2012.
0 Our RTLS division has seen excellent progress with a number of
blue chip customers in automobile and aerospace manufacturing. Two
of our biggest customers, EADS and BMW, grew from single RTLS
deployments to multiple installations across their global
operations. We have continued to leverage partners' brands and
customers to accelerate growth. Our most notable partnership here
is with Atlas Copco, a leading industrial tool manufacturer.
0 In our Geospatial division, we delivered both organic and
inorganic growth and the merits of our strategy can be seen in the
strategically important acquisitions we made in 2011.
In September 2011, we acquired Integrated Mapping Services, Inc.
("InMaps"), a US-based company which strengthened our offering in
the electricity and gas industries.
In October 2011, Ubisense acquired Realworld OO Systems Limited
("Realworld"), a UK-based company with considerable expertise in
providing location solutions to telecoms companies throughout the
world. This acquisition saw our customer base in the UK expand to
include Cable and Wireless Communications and Global Crossing.
Both of these acquisitions are performing in line with Board
expectations.
Strategy
The opportunity for Ubisense continues to be huge and the Group
continues to grow in an agile and prudent way. The Board's focus in
the coming year is on growing the business by extending the model
in its priority G7 markets, particularly in the key Asian markets
of Korea and Japan, and to capture new customers through new
strategic partnerships like the one in place with Atlas Copco. Our
aim is to create long lasting customer relationships with major
global businesses in high value markets.
The Board is also committed to continuing to grow through
acquisitions and continues to evaluate any suitable opportunities
in this area.
Current trading and outlook
In the period since the year end, current trading has been in
line with the Board's expectations and is ahead of the prior
year.
New network build outs in the telecoms industry and continued
regulation in the energy sector set the scene for another positive
year of demand in our Geospatial division. In RTLS, the recovery in
the automotive sector continues and the dynamics for the aerospace
and transportation industries also look positive. Asia is also
likely to be a driver of growth for Ubisense in the year ahead
following our first installations in the Korean automotive
market.
We begin 2012 with a record order book and the Board looks
forward to the year ahead with confidence.
Conclusion
Finally, it was fantastic to see the continued long-term support
of our investors rewarded with an IPO which in turn has positioned
Ubisense strongly for its next growth phase.
I would like to thank all of our employees, strategic partners
and customers for their contributions and support in making 2011
such a successful year for our shareholders.
Andy Hopper
6 March 2012
Chief executive's review
-------------------------
Overview
Ubisense performed very well over the year delivering record
growth in revenue and adjusted EBITDA. This reflected the growing
awareness and deployment of our market leading location solutions
to top tier organisations around the world and the continuing
execution of our proven growth strategy.
This growth was delivered in both the Real-time location and
Geospatial divisions. This reflects improving market conditions in
the manufacturing sector and our success in building on our long
term customer relationships in both divisions. Following flotation
in June 2011, we made two further acquisitions in the UK and North
America strengthening our presence, skill base, software product
portfolio and customer list in both territories.
Customer momentum
In September we extended our reach into China when we signed a
global license agreement with BMW. Our system is now operational in
five out of their eight plants worldwide. We estimate that more
than one million cars have been tagged and processed by our system
since installation, making it the most widely deployed system of
its kind in the world.
EADS continued the trend and placed an order for a global
license agreement in December. They are deploying the system across
each major aircraft program at Airbus, including the A320, A330,
A340, A350, A380 and A400M, along with additional deployments at
Eurocopter.
Our continued success with new wins and contract extensions for
our manufacturing accounts led to the establishment of a subsidiary
in France during the year.
Researchers continue to deploy our RTLS technology across
multiple applications. The most significant project in 2011 was
University of South Florida ("USF") working with the US Department
of Veteran Affairs ("VA") on their Smart home project which was
very high profile in the US.
In our Geospatial division, Deutsche Telekom continued to
develop as a strategic customer with the roll out of a Fibre
Planning System across 2000 users. We also took the lead in
geospatial projects in North America, with new wins at Atmos Energy
and Puget Sound Energy.
Acquisitions
Significant progress was made in integrating our two
acquisitions, InMaps in North America and Realworld in the UK, into
the business. Both companies brought with them intellectual
property which has the potential to be introduced into the rest of
our customer base around the world.
We continue to look for acquisition opportunities to enhance our
product portfolio and geographical footprint.
Strategic Partnerships
Atlas Copco continued to introduce us to their customer base
world-wide which resulted directly or indirectly in system sales to
Audi, Jaguar Land Rover, GM, Hyundai and Paccar, all of which
represent multiple site opportunities in the future.
Last month, we added to our roster of strategic partnerships
when we reached an agreement with ATS Global ("ATS"), a global
company serving the Manufacturing Execution Systems market. The
alliance will allow our joint customers to benefit from even
greater levels of flexibility and traceability, supporting
manufacturing efficiency goals such as automation, process control
and error proofing.
Products
Continued investment in research and development led to the
release of new applications in both divisions. Transit Yard Manager
("TYM"), Assembly Control System ("ACS"), Fibre Planning System
("FPS") and myWorld were all introduced during the year at early
customer sites for evaluation. Feedback so far has been very
positive and we look forward to an order book developing for these
products.
Richard Green
Chief Executive Officer
6 March 2012
Financial review
-----------------
In the year ended 31 December 2011, the Group generated revenue
of GBP23.8 million (2010: GBP17.7 million). The 2011 revenue
figures include the effect of the acquisitions of InMaps and
Realworld from the beginning of October.
Gross Profit increased to GBP8.5 million (2010: GBP5.9 million),
representing an improvement in Gross Margin to 35.6% (2010: 33.5%).
Operating profit in 2011 was GBP0.3 million (2010: GBP0.6 million)
as the Group continues to invest in research and development
activities. In 2011 the Group commenced research and development
activities in its Geospatial business and this investment was
further enhanced by the two acquisitions.
Adjusted EBITDA is calculated as operating profit adding back
depreciation and amortisation, share-based payment charges,
acquisition costs and AIM listing expenses. Adjusted EBITDA in 2011
was GBP1.4 million (2010: GBP1.0 million).
Profit before tax was GBP0.1 million (2010: GBP0.4 million) and
profit after tax was GBP0.03 million (2010: GBP0.4 million). The
Group has utilised tax losses carried forward in several of its
subsidiaries and has received an R&D Tax Credit in the UK, the
impact of which means that current tax liabilities on profits are
minimal. Deferred tax movements, relating primarily to intangible
assets, result in a net tax charge to the income statement of
GBP0.1m. The above profit figures for 2011 include non-recurring
items relating to the Initial Public Offering ("IPO") in June and
the acquisition costs of Realworld and InMaps. Excluding these
charges, the adjusted profit after tax was GBP0.4 million (2010:
GBP0.4 million).
Based on the average number of shares in issue during the year,
diluted earnings per share were 0.2 pence (2010: 3.2 pence) and
adjusted diluted earnings per share were 5.5 pence (2010: 5.7
pence).
Revenue from the RTLS Division was GBP8.7 million, compared with
GBP5.7 million in 2010. This 51% growth in revenues was driven
principally by sales to new customers as well as increased
penetration into existing customer accounts. The top 10 customers
accounted for 66% of the revenue in 2011 (2010: 45%). Revenue from
the Geospatial Division was GBP15.1 million including acquisitions,
compared with GBP12.0 million in 2010. This 26.5% growth in
revenues was driven by a number of factors including (i) two
significant new customer wins in the USA (Puget Sound Energy and
Atmos Energy); (ii) increased products sales; (iii) the impacts of
the two acquisitions and (iv) increased engagement with our
existing customer base. The top 10 customers accounted for 89% of
the revenue in 2011 (2010: 81%).
The Group has a strong balance sheet with Shareholder Funds at
31 December 2011 of GBP19.2 million, equivalent to 89 pence per
share (2010: Shareholder Funds of GBP11.5 million equivalent to 76
pence per share). The cash position was strengthened by the IPO,
such that net cash at 31 December 2011 was GBP6.0 million (2010:
GBP3.5 million). Funds raised from the IPO have been used to (i)
repay the bank loans, (ii) increase the inventory levels of the
Groups RTLS products, (iii) fund the acquisitions and (iv) pay for
the costs of the IPO.
Operating cash flows before working capital were GBP1.1 million
(2010: GBP1.0 million). After working capital, cash used by
operations was GBP2.3 million (2010: GBP0.7 million generated),
reflecting increases in inventory levels and trade receivables.
Consistent with the Group's defined strategy of investing available
funds in organic and inorganic growth opportunities, the Board is
not proposing to pay a dividend for 2011 (2010: nil).
Gordon Campbell
Chief Financial Officer
6 March 2012
Consolidated income statement
------------------------------------
For the year ended 31 December 2011
====================================
2011 2010
Notes GBP'000 GBP'000
------------------------------------ ------ --------- ---------
Revenue 6 23,785 17,697
Cost of sales (15,308) (11,762)
==================================== ====== ========= =========
Gross Profit 8,477 5,935
Administrative expenses (8,188) (5,308)
==================================== ====== ========= =========
Operating profit 6 289 627
Analysed as:
Adjusted EBITDA 1,448 1,041
Depreciation (140) (97)
Amortisation (624) (299)
Share-based payments charge (24) (18)
AIM listing expenses (324) -
Acquisition costs (47) -
------------------------------------ ------ --------- ---------
Operating profit 6 289 627
Finance income 8 37 5
Finance costs 8 (185) (237)
------------------------------------ ------ --------- ---------
Profit before tax 141 395
------------------------------------ ------ --------- ---------
Income tax 9 (107) 3
------------------------------------ ------ --------- ---------
Profit for the period attributable
to the equity shareholders of the
Company 34 398
------------------------------------ ------ --------- ---------
Earnings per share (pence)
------------------------------------ ------ --------- ---------
Basic 10 0.2p 3.3p
Diluted 10 0.2p 3.2p
------------------------------------ ------ --------- ---------
Consolidated statement of comprehensive income
-----------------------------------------------
For the year ended 31 December 2011
===============================================
2011 2010
GBP'000 GBP'000
----------------------------------------- --------- ---------
Profit for the period 34 398
Other comprehensive income:
Exchange difference on retranslation
of net assets and results of overseas
subsidiaries 14 (29)
Total comprehensive income attributable
to equity shareholders of the Company 48 369
----------------------------------------- --------- ---------
Consolidated statement of changes in equity
--------------------------------------------
For the year ended 31 December 2011
============================================
Retained
Share capital Share premium Other reserves earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
=================================== ============== ============== =============== ========== =========
Balance at 1 January 2010 235 9,773 961 (4,670) 6,299
=================================== ============== ============== =============== ========== =========
Profit for the period - - - 398 398
Exchange difference on
retranslation of net assets
and results of overseas
subsidiaries - - (29) - (29)
=================================== ============== ============== =============== ========== =========
Total comprehensive income
for the period - - (29) 398 369
Reserve credit for equity-settled
share-based payment - - 18 - 18
Equity component of loans - - 3 - 3
Issue of new share capital 69 - - - 69
Premium on new share capital - 4,973 - - 4,973
Share issue costs - (196) - - (196)
=================================== ============== ============== =============== ========== =========
Transactions with owners 69 4,777 21 - 4,867
=================================== ============== ============== =============== ========== =========
Balance at 31 December
2010 304 14,550 953 (4,272) 11,535
=================================== ============== ============== =============== ========== =========
Profit for the period - - - 34 34
Exchange difference on
retranslation of net assets
and results of overseas
subsidiaries - - 14 - 14
=================================== ============== ============== =============== ========== =========
Total comprehensive income
for the period - - 14 34 48
Reserve credit for equity-settled
share-based payment - - 45 - 45
Equity component of loans
converted - - (502) 502 -
Issue of new share capital 129 - - - 129
Premium on new share capital - 7,968 - - 7,968
Share issue costs - (487) - - (487)
=================================== ============== ============== =============== ========== =========
Transactions with owners 129 7,481 (457) 502 7,655
=================================== ============== ============== =============== ========== =========
Balance at 31 December
2011 433 22,031 510 (3,736) 19,238
=================================== ============== ============== =============== ========== =========
A reconciliation of the components of Other reserves is given in
note 19.
Consolidated statement of financial position
---------------------------------------------
At 31 December 2011
=============================================
2011 2010
Notes GBP'000 GBP'000
---------------------------------- ------ --------- ---------
Assets
Non-current assets
Goodwill 11 7,418 6,069
Other intangible assets 12 2,258 525
Property, plant and equipment 13 366 279
Total non-current assets 10,042 6,873
================================== ====== ========= =========
Current assets
Inventories 1,667 364
Trade and other receivables 14 9,498 6,900
Cash and cash equivalents 6,034 7,130
================================== ====== ========= =========
Total current assets 17,199 14,394
================================== ====== ========= =========
Total assets 27,241 21,267
================================== ====== ========= =========
Liabilities
Current liabilities
Loans and borrowings 16 - (2,372)
Trade and other payables 15 (7,294) (5,974)
Total current liabilities (7,294) (8,346)
================================== ====== ========= =========
Non-current liabilities
Loans and borrowings 16 - (1,246)
Deferred income tax liabilities (549) (140)
Other liabilities 17 (160) -
================================== ====== ========= =========
Total non-current liabilities (709) (1,386)
================================== ====== ========= =========
Total liabilities (8,003) (9,732)
================================== ====== ========= =========
Net assets 19,238 11,535
================================== ====== ========= =========
Equity attributable to owners of
the parent company
Share capital 18 433 304
Share premium account 18 22,031 14,550
Other reserves 19 510 953
Retained earnings (3,736) (4,272)
================================== ====== ========= =========
Total equity 19,238 11,535
================================== ====== ========= =========
Consolidated statement of cash flows
-------------------------------------
For the year ended 31 December 2011
=====================================
2011 2010
Notes GBP'000 GBP'000
------------------------------------------ ------ --------- ---------
Profit before tax 141 395
Adjustments for:
Depreciation 140 97
Amortisation 624 299
Share-based payments charge 24 18
Finance income (37) (5)
Finance costs 185 237
Foreign exchange differences 12 (12)
------------------------------------------ ------ --------- ---------
Operating cash flows before working
capital movements 1,089 1,029
Change in inventories (1,303) (100)
Change in receivables (2,065) (3,244)
Change in payables (108) 3,009
------------------------------------------ ------ --------- ---------
Cash (used)/generated by operations
before tax (2,387) 694
------------------------------------------ ------ --------- ---------
Net income taxes received 102 32
------------------------------------------ ------ --------- ---------
Net cash flows from operating activities (2,285) 726
------------------------------------------ ------ --------- ---------
Cash flows from investing activities
Acquisition of subsidiaries, net
of cash acquired 20 (1,600) -
Purchases of property, plant and
equipment (256) (218)
Purchases of intangible assets (1,130) (400)
Interest received 33 5
------------------------------------------ ------ --------- ---------
Net cash flows from investing activities (2,953) (613)
------------------------------------------ ------ --------- ---------
Cash flows from financing activities
Proceeds from the issue of borrowings - 150
Repayment of borrowings (1,014) (255)
Interest paid (47) (108)
Proceeds from the issue of share
capital 5,238 4,846
------------------------------------------ ------ --------- ---------
Net cash flows from financing activities 4,177 4,633
Net (decrease)/increase in cash and
cash equivalents (1,061) 4,746
Cash and cash equivalents at start
of period 7,130 2,396
Exchange differences on cash and
cash equivalents (35) (12)
========================================== ====== ========= =========
Cash and cash equivalents at end
of period 6,034 7,130
========================================== ====== ========= =========
Notes to the preliminary announcement
--------------------------------------
1 General information
======================================
Ubisense Group plc ('the Company') and its subsidiaries
(together, 'the Group') deliver mission-critical enterprise asset
tracking and geospatial systems.
The Group has operations in the UK, US, Canada, France, Germany,
Korea and Singapore and sells mainly in North America and
Europe.
The Company is a public limited company which is listed on the
Alternative Investment Market ('AIM') of the London Stock Exchange
(UBI.L) and is incorporated and domiciled in the UK. The address of
its registered office is St. Andrew's House, 90 St. Andrew's Road,
Chesterton, Cambridge, CB4 1DL.
The Board of Directors approved the release of this unaudited
preliminary announcement on 5 March 2012.
The financial information set out in this unaudited preliminary
announcement does not comprise statutory accounts within the
meaning of section 434 of the Companies Act 2006. Statutory
accounts for the year ended 31 December 2010 were approved by the
Board of Directors on 21 April 2011 and have been delivered to the
Registrar of Companies. The report of the auditors on those
accounts was unqualified, did not contain an emphasis of matter
paragraph and did not contain any statement under section 498 of
the Companies Act 2006.
The auditors have yet to report on the statutory accounts for
the year ended 31 December 2011. The audited Annual Report for the
year ended 31 December 2011 will be posted to shareholders in due
course and will be delivered to the Registrar of Companies
following the Annual General Meeting of the Company. The report
will also be available on the investor relations page of the
Company's website.
Further copies will be available on request and free of charge
from the Company Secretary.
2 Basis of preparation
=====================
The preliminary announcement should be read in conjunction with
the annual financial statements of the Group and are prepared in
accordance with IFRSs as adopted by the European Union.
Going concern basis
The Group's forecasts and projections, taking account of
reasonably possible changes in trading performance, support the
conclusion that there is a reasonable expectation that the Company
and the Group have adequate resources to continue in operational
existence for the foreseeable future, a period of not less than
twelve months from the date of this report. The Group therefore
continues to adopt the going concern basis in preparing its
preliminary announcement.
3 Accounting policies
====================
The accounting policies adopted in the preparation of the
preliminary announcement are consistent with those followed in the
preparation of the Group's consolidated financial statements for
the year ended 31 December 2010.
4 Estimates
==========
The preparation of the financial statements requires management
to make judgements, estimates and assumptions that affect the
application of accounting policies and the reported amounts of
assets and liabilities, income and expense. Actual results may
differ from these estimates.
5 Risks and uncertainties
========================
An outline of the key risks and uncertainties faced by the Group
was described in the financial statements for the year ended 31
December 2010, including exposure to foreign exchange rate
fluctuation, in particular the strength of Sterling relative to the
US dollar and Euro. Risk is an inherent part of doing business and
the strong cash position of the Group as a result of the fund
raising and admission to AIM on 22 June 2011 along with the strong
order book leads the Directors to believe that the Group is well
placed to manage business risks successfully.
6 Operating segments
===================
Management has determined the operating segments to be the
Group's two divisions based on the reports reviewed by the Chief
Operating Decision Maker.
The Real-Time Location Systems division ("RTLS") delivers
mission-critical enterprise asset tracking solutions utilising
ultra-wideband ("UWB") technology to locate people and assets in
3D, bringing visibility and control to industrial business
processes.
The Geospatial division delivers core location based solutions,
typically to blue chip utility and communications companies, to
allow them to better plan and maintain their dispersed network of
assets.
Centrally incurred costs not directly attributable to business
segments are reported under 'Central'.
Each of these operating segments is managed separately as each
deal with different technologies and predominantly different
customer bases. The performance of the operating segments is
assessed on a measurement of adjusted EBITDA. The measurement basis
excludes depreciation, amortisation, share-based payments charge,
non-recurring expenditure, finance income and expense and income
taxes.Other administrative expenses for the year ended 31 December
2010 have been reclassified to be consistent with current internal
management reporting. The effect on the period ended 31 December
2010 was to decrease administrative expenses for RTLS by GBP727,000
and increase Geospatial and Central by GBP66,000 and GBP661,000
respectively.
RTLS Geospatial Central Total
Year ended 31 December 2011 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------- --------- ----------- --------- ---------
Revenue 8,650 15,135 - 23,785
Cost of sales (4,012) (11,296) - (15,308)
=============================== ========= =========== ========= =========
Gross Profit 4,638 3,839 - 8,477
Other administrative expenses (3,936) (738) (2,355) (7,029)
=============================== ========= =========== ========= =========
Adjusted EBITDA 702 3,101 (2,355) 1,448
Depreciation - - (140) (140)
Amortisation (437) (169) (18) (624)
Share-based payments charge - - (24) (24)
AIM listing expenses - - (324) (324)
Acquisition costs - - (47) (47)
=============================== ========= =========== ========= =========
Operating profit/(loss) 265 2,932 (2,908) 289
Finance income - - 37 37
Finance costs - - (185) (185)
=============================== ========= =========== ========= =========
Profit before tax/(loss) 265 2,932 (3,056) 141
=============================== ========= =========== ========= =========
RTLS Geospatial Central Total
Year ended 31 December 2010 GBP'000 GBP'000 GBP'000 GBP'000
=============================== ========= =========== ========= =========
Revenue 5,729 11,968 - 17,697
Cost of sales (2,520) (9,242) - (11,762)
=============================== ========= =========== ========= =========
Gross Profit 3,209 2,726 - 5,935
Other administrative expenses (3,168) (229) (1,497) (4,894)
=============================== ========= =========== ========= =========
Adjusted EBITDA 41 2,497 (1,497) 1,041
Depreciation (2) - (95) (97)
Amortisation (299) - - (299)
Share-based payments charge - - (18) (18)
Operating profit/(loss) (260) 2,497 (1,610) 627
Finance income - - 5 5
Finance costs - - (237) (237)
=============================== ========= =========== ========= =========
Profit/(loss) before tax (260) 2,497 (1,842) 395
=============================== ========= =========== ========= =========
7 Employee information
=====================
Average monthly number of people, including
executive directors employed by the 2011 2010
Group during the year was: Number Number
--------------------------------------------- -------- --------
By activity
Technical consultants 75 60
Sales & Marketing 28 18
Research & Development 21 12
Administration 14 9
============================================= ======== ========
138 99
============================================= ======== ========
By segment
Geospatial 64 45
RTLS 60 45
Central 14 9
============================================= ======== ========
138 99
The total number of employees at 31 December 2011 was 172 (2010:
113)
2011 2010
GBP'000 GBP'000
--------------------------------------- --------- ---------
Wages and salaries 10,236 6,724
Social security costs 979 679
Contributions to defined contribution
pension arrangements 419 307
Share-based payments 24 18
======================================= ========= =========
11,658 7,728
======================================= ========= =========
8 Finance income and costs
=========================
2011 2010
GBP'000 GBP'000
------------------------------------------------ --------- ---------
Interest income from cash and cash equivalents 37 5
================================================ ========= =========
Finance income 37 5
================================================ ========= =========
2011 2010
GBP'000 GBP'000
-------------------------------- --------- ---------
Interest payable - bank (26) (43)
Interest payable - other loans (159) (194)
================================ ========= =========
Finance costs (185) (237)
-------------------------------- --------- ---------
Finance costs for the year ended 31 December 2011 includes an
imputed non-cash amount of GBP138,000 relating to interest as a
result of conversion of the Convertible Loans into shares and
exercise of the warrants attaching to the bank loan (see note
18).
9 Income tax
===========
2011 2010
GBP'000 GBP'000
------------------------------------------------ --------- ---------
Current tax
UK Corporation Tax - 23
Foreign tax (9) -
Research and development tax credits
- prior years (124) (47)
================================================ ========= =========
Total current tax credit (133) (24)
Deferred tax
Origination and reversal of timing differences 240 21
================================================ ========= =========
Total deferred tax 240 21
================================================ ========= =========
Total tax charge/(credit) on profit
on ordinary activities 107 (3)
================================================ ========= =========
The tax charge (2010: credit) differs to the standard rate of
corporation tax in the UK for the year of 26% (2010: 28%) for the
following reasons:
2011 2010
GBP'000 GBP'000
========================================== ========= =========
Profit before tax 141 395
Profit before tax multiplied by the
standard rate of corporation tax in
the UK of 26% (2010: 28%) 37 111
Tax effects of:
Expenses not deductible for tax purposes 113 37
(Utilisation)/creation of tax losses 14 (73)
Research and development tax credits (124) (47)
Differential on tax rates (8) (5)
Remeasurement of deferred tax - change
of rate (5) -
Other temporary timing differences 80 (26)
========================================== ========= =========
Total tax charge/(credit) for the year 107 (3)
========================================== ========= =========
10 Earnings per share
=== ===================
2011 2010
------------------------------------------- ------- -------
Earnings
Profit for the period (GBP'000) 34 398
=========================================== ======= =======
Earnings for the purposes of diluted
earnings per share (GBP'000) 34 398
=========================================== ======= =======
Number of shares
Basic weighted average number of shares
('000) 18,897 12,034
Effect of dilutive potential ordinary
shares:
* Share options ('000) 334 444
* Warrants ('000) 59 107
=========================================== ======= =======
Diluted weighted average number of shares
('000) 19,290 12,585
=========================================== ======= =======
Basic earnings per share (pence) 0.2p 3.3p
=========================================== ======= =======
Diluted earnings per share (pence) 0.2p 3.2p
=========================================== ======= =======
Basic earnings per share is calculated by dividing profit for
the period attributable to ordinary shareholders of the Company by
the weighted average number of ordinary shares outstanding during
the period. For diluted earnings per share, the weighted average
number of shares is adjusted to allow for the effects of dilutive
share options and warrants.
The Group also presents an adjusted diluted earnings per share
figure which excludes amortisation, share-based payments charge,
AIM listing expenses and acquisition costs from the measurement of
profit for the period.
Adjusted diluted earnings per share 2011 2010
-------------------------------------------- ------ -----
Earnings for the purposes of diluted
earnings per share (GBP'000) 34 398
Adjustments
Reversal of amortisation (GBP'000) 624 299
Reversal of share-based payments charge
(GBP'000) 24 18
Reversal of AIM listing expenses (GBP'000) 324 -
Reversal of acquisition costs (GBP'000) 47 -
-------------------------------------------- ------ -----
Net adjustments (GBP'000) 1,019 317
-------------------------------------------- ------ -----
Adjusted earnings (GBP'000) 1,053 715
-------------------------------------------- ------ -----
Adjusted diluted earnings per share
(pence) 5.5p 5.7p
-------------------------------------------- ------ -----
11 Goodwill
=== =========
Goodwilll
GBP'000
------------------------------------------- ----------
Balance at 1 January 2010 and 31 December
2010 6,069
Acquisition of subsidiaries 1,349
Balance at 31 December 2011 7,418
=========================================== ==========
The goodwill arising in the year relates to the acquisitions of
Integrated Mapping Solutions, Inc. and Realworld OO Systems Limited
which is further described in note 20.
12 Other intangible assets
=== ========================
Acquired
customer
Capitalised Acquired relationships
development software and order
costs Software products backlog Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
============================= ============= ========= ========== =============== =========
Cost
At 1 January 2010 1,087 - - - 1,087
Additions 389 11 - - 400
============================= ============= ========= ========== =============== =========
At 31 December 2010 1,476 11 - - 1,487
============================= ============= ========= ========== =============== =========
Reclassification between
categories - 56 - - 56
Additions 1,103 225 - - 1,328
Acquisition of subsidiaries - 3 529 449 981
============================= ============= ========= ========== =============== =========
At 31 December 2011 2,579 295 529 449 3,852
============================= ============= ========= ========== =============== =========
Accumulated amortisation
At 1 January 2010 663 - - - 663
Charge for the year 295 4 - - 299
============================= ============= ========= ========== =============== =========
At 31 December 2010 958 4 - - 962
============================= ============= ========= ========== =============== =========
Reclassification between
categories - 8 - - 8
Charge for the year 494 18 44 68 624
============================= ============= ========= ========== =============== =========
At 31 December 2011 1,452 30 44 68 1,594
============================= ============= ========= ========== =============== =========
Net book value
============================= ============= ========= ========== =============== =========
At 31 December 2011 1,127 265 485 381 2,258
============================= ============= ========= ========== =============== =========
At 31 December 2010 518 7 - - 525
============================= ============= ========= ========== =============== =========
The acquired software products, customer relationships and order
backlog additions arising in the year relate to the acquisitions of
Integrated Mapping Solutions, Inc. and Realworld OO Systems Limited
which is further described in note 20.
13 Property, plant and equipment
=== ==============================
Fixtures Computer
& Fittings Equipment Total
GBP'000 GBP'000 GBP'000
===================================== ============ =========== =========
Cost
At 1 January 2010 309 334 643
Effect of movements in exchange
rates (3) (5) (8)
Additions 18 200 218
Disposals (150) (89) (239)
===================================== ============ =========== =========
At 31 December 2010 174 440 614
===================================== ============ =========== =========
Effect of movements in exchange
rates (3) (5) (8)
Reclassification between categories - (56) (56)
Additions 47 213 260
Acquisition of subsidiaries 3 14 17
Disposals - (1) (1)
===================================== ============ =========== =========
At 31 December 2011 221 605 826
===================================== ============ =========== =========
Accumulated depreciation
At 1 January 2010 218 263 481
Effect of movements in exchange
rates (2) (3) (5)
Charge for the year 29 68 97
Disposals (150) (88) (238)
===================================== ============ =========== =========
At 31 December 2010 95 240 335
===================================== ============ =========== =========
Effect of movements in exchange
rates (1) (5) (6)
Reclassification between categories - (8) (8)
Charge for the year 34 106 140
Disposals - (1) (1)
===================================== ============ =========== =========
At 31 December 2011 128 332 460
===================================== ============ =========== =========
Net book value
At 31 December 2011 93 273 366
===================================== ============ =========== =========
At 31 December 2010 79 200 279
===================================== ============ =========== =========
14 Trade and other receivables
=== ============================
2011 2010
GBP'000 GBP'000
---------------------------------- --------- ---------
Trade receivables, gross 7,541 5,469
Allowances for credit losses (7) (83)
================================== ========= =========
Trade receivables net 7,534 5,386
Amounts recoverable on contracts 1,588 555
Other receivables 21 21
Prepayments and accrued income 314 816
VAT and taxation receivable 41 122
================================== ========= =========
9,498 6,900
================================== ========= =========
15 Trade and other payables
=== =========================
2011 2010
GBP'000 GBP'000
------------------------------------ --------- ---------
Payments received on account 1,995 2,178
Trade payables 2,110 1,945
Trade accruals 1,633 933
Current tax liability - 8
Other taxation and social security 817 717
Other payables 339 193
Other liabilities - contingent
consideration 400 -
==================================== ========= =========
7,294 5,974
==================================== ========= =========
The current element of the contingent consideration relates to
the acquisition of Realworld OO Systems Limited in the year which
is further described in note 20.
16 Loans and borrowings
=== =====================
2011 2010
GBP'000 GBP'000
---------------------------------------- ---------- ---------
Non-current
Bank loan - 492
Convertible Loan - 754
======================================== ========== =========
Total non-current loans and borrowings - 1,246
Current
Bank loan - 398
Convertible Loan - 1,974
======================================== ========== =========
Total current loans and borrowings - 2,372
======================================== ========== =========
Total loans and borrowings - 3,618
======================================== ========== =========
During the period, the bank loan was repaid in full. Of the
Convertible Loan, GBP2,364 was repaid with the remainder converted
into ordinary shares (see note 18).
17 Other liabilities
=== ==================
2011 2010
GBP'000 GBP'000
------------------------------- --------- ---------
Non-current
Other liabilities - contingent
consideration 160 -
The non-current element of the contingent consideration relates
to the acquisition of Realworld OO Systems Limited in the year
which is further described in note 20.
18 Share capital and premium
=== ==========================
Number of
ordinary shares
of GBP0.02 Share capital Share premium Total
each GBP'000 GBP'000 GBP'000
-------------------------------- ----------------- -------------- -------------- ---------
Balance at 1 January 2010 11,755,265 235 9,773 10,008
Share issue 3,401,360 68 4,932 5,000
Share issue costs - - (196) (196)
Issued under share-based
payment plans 26,500 - 16 16
Issued on conversion of
Convertible Loan 28,365 1 25 26
================================ ================= ============== ============== =========
Change in year 3,456,225 69 4,777 4,846
================================ ================= ============== ============== =========
Balance at 31 December 2010 15,211,490 304 14,550 14,854
================================ ================= ============== ============== =========
Share issue 2,777,778 56 4,944 5,000
Share issue costs - - (486) (486)
Issued under share-based
payment plans 376,308 8 125 133
Issued on conversion of
Convertible Loan 3,176,772 63 2,796 2,859
Issued on exercise of warrants 115,350 2 102 104
================================ ================= ============== ============== =========
Change in year 6,446,208 129 7,481 7,610
================================ ================= ============== ============== =========
Balance at 31 December 2011 21,657,698 433 22,031 22,464
================================ ================= ============== ============== =========
The Company has one class of ordinary shares which carry no
right to fixed income
During the period, the Company issued 6,446,208 shares
increasing the total number of shares in issue from 15,211,490 to
21,657,698 as follows:
-- 2,777,778 shares as a result of new share subscriptions at GBP1.80 per share for total cash consideration of GBP5,000,000, with share issue costs of GBP486,000 charged against the share premium account and listing expenses of GBP324,000 charged to the income statement. Included in the share issue costs charged to the share premium account is an amount of GBP22,000 relating to share-based payments in respect of warrants granted to professional advisers in lieu of fees;
-- 376,308 shares as a result of options exercised with a
weighted average exercise price of GBP0.36 per share for total cash
consideration of GBP134,099;
-- 3,176,772 shares as a result of the Convertible Loans being
converted at GBP0.90 per share for total loan value converted of
GBP2,859,095;
-- 115,350 shares as a result of exercise of warrants entitled
under the bank loan at GBP0.90 per share for cash consideration of
GBP103,815.
19 Other reserves
=== ===============
Equity component
of convertible Share-based
loans and payment Translation
warrants reserve reserve Total
GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------------- ----------------- ------------ ------------ ---------
Balance at 1 January 2010 499 528 (66) 961
Exchange difference on retranslation
of net assets and results
of overseas subsidiaries - - (29) (29)
Reserve credit for equity-settled
share-based payment - 18 - 18
Equity component of loans 3 - - 3
====================================== ================= ============ ============ =========
Balance at 31 December 2010 502 546 (95) 953
====================================== ================= ============ ============ =========
Exchange difference on retranslation
of net assets and results
of overseas subsidiaries - - 14 14
Reserve credit for equity-settled
share-based payment - 45 - 45
Equity component of loans
converted (502) - - (502)
====================================== ================= ============ ============ =========
Balance at 31 December 2011 - 591 (81) 510
====================================== ================= ============ ============ =========
20 Business Combinations
=== ======================
20.1 Subsidiaries acquired
Proportion
of equity
Country Principal Date of interest
Subsidiary of incorporation activity acquisitions acquired
Integrated Mapping Services, Location 26 September
Inc. USA Solutions 2011 100%
Location 4 October
Realworld OO Systems Limited United Kingdom Solutions 2011 100%
============================== =================== ============ =============== ===========
Integrated Mapping Services, Inc. ("InMaps") and Realworld OO
Systems Limited ("Realworld") were acquired to continue the
expansion of the Group's Geospatial division. Both InMaps and
Realworld are location solutions businesses providing geospatial
software products and consulting, the former with a focus on the
electric and gas sector, the latter on the telecommunications
sector. The acquisitions will enhance the Group's product range,
product development capability, sector presence and geographical
footprint.
20.2 Consideration transferred
InMaps Realworld Total
GBP'000 GBP'000 GBP'000
------------------------------- --------- ---------- ---------
Cash consideration paid 393 1,250 1,643
Contingent cash consideration
arrangement - 560 560
Consideration transferred 393 1,810 2,203
=============================== ========= ========== =========
Under the contingent cash consideration arrangement, the Group
is required to pay additional amounts to the vendors of Realworld
based on the achievement of two separate performance milestones
that may arise between 2012 and 2013 with a combined undiscounted
range of outcomes between zero and GBP1,150,000. A liability of
GBP560,000 was recognised at the acquisition date, based on
management's best estimate of the probability-adjusted expected
cash outflow from the arrangement. As at 31 December 2011 the
amount recognised for this arrangement was unchanged based on the
most recent management estimates.
Maturity of contingent consideration is as follows:
2011 2010
Notes GBP'000 GBP'000
============= ====== ========= =========
Non-current 17 160 -
Current 15 400 -
============= ====== ========= =========
Total 560 -
============= ====== ========= =========
Acquisition-related costs amounting to GBP47,000 (InMaps:
GBP16,000; Realworld: GBP31,000) have been excluded from the
consideration transferred and have been recognised as an expense in
the current year within the 'administrative expenses' line item in
the consolidated income statement.
20.3 Assets acquired and liabilities recognised at the date of
acquisition
InMaps Realworld Total
GBP'000 GBP'000 GBP'000
--------------------------------- --------- ---------- ---------
Assets
Non-current assets
Software products 191 338 529
Customer relationships 184 218 402
Order backlog 11 36 47
Property, plant and equipment 11 8 19
Deferred income tax assets 32 88 120
Total non-current assets 429 688 1,117
================================= ========= ========== =========
Current assets
Trade and other receivables 83 379 462
Cash and cash equivalents 32 11 43
================================= ========= ========== =========
Total current assets 115 390 505
================================= ========= ========== =========
Total assets 544 1,078 1,622
================================= ========= ========== =========
Liabilities
Current liabilities
Loans and borrowings (36) - (36)
Trade and other payables (51) (307) (358)
================================= ========= ========== =========
Total current liabilities (87) (307) (394)
================================= ========= ========== =========
Non-current liabilities
Loans and borrowings (86) - (86)
Deferred income tax liabilities (134) (154) (288)
Total non-current liabilities (220) (154) (374)
================================= ========= ========== =========
Total liabilities (307) (461) (768)
================================= ========= ========== =========
Fair value of identifiable
net assets acquired 237 617 854
================================= ========= ========== =========
The fair value of trade and other receivables of GBP462,000
includes trade receivables with a fair value and gross contractual
value of GBP415,000 (InMaps: GBP80,000; Realworld: GBP335,000), all
of which is expected to be collectable.
20.4 Goodwill arising on acquisitions
InMaps Realworld Total
GBP'000 GBP'000 GBP'000
---------------------------------- --------- ---------- ---------
Consideration transferred 393 1,810 2,203
Less: fair value of identifiable
net assets acquired (237) (617) (854)
Goodwill arising on acquisitions 156 1,193 1,349
================================== ========= ========== =========
Goodwill arose on the acquisitions of InMaps and Realworld in
respect of the benefits of highly knowledgeable workforces,
expected operational synergies, revenue growth and future market
development. These benefits are not recognised separately from
goodwill because they do not meet the recognition criteria for
identifiable intangible assets
None of the goodwill arising on these acquisitions is expected
to be deductible for tax purposes.
20.5 Net cash outflow on acquisition of subsidiaries
InMaps Realworld Total
GBP'000 GBP'000 GBP'000
--------------------------------- --------- ---------- ---------
Cash consideration paid 393 1,250 1,643
Less: cash and cash equivalent
balances acquired (32) (11) (43)
Net cash outflow on acquisition
of subsidiaries 361 1,239 1,600
================================= ========= ========== =========
20.6 Impact of acquisitions on the results of the Group
The incremental of acquisitions to the Group's results for the
year are set out in the table below:
Before acquisitions InMaps Realworld Total
GBP'000 GBP'000 GBP'000 GBP'000
========================== ==================== ========= ========== =========
Revenue 23,022 78 685 23,785
Adjusted EBITDA 1,295 (66) 219 1,448
Profit/(loss) before tax 100 (103) 144 141
========================== ==================== ========= ========== =========
If the acquisitions were effective from 1 January 2011, the
Group's estimated results would have been as follows:
Before acquisitions InMaps Realworld Total
GBP'000 GBP'000 GBP'000 GBP'000
========================== ==================== ========= ========== =========
Revenue 23,022 435 2,080 25,537
Adjusted EBITDA 1,295 (96) (153) 1,046
Profit/(loss) before tax 100 (133) (228) (261)
========================== ==================== ========= ========== =========
This information is provided by RNS
The company news service from the London Stock Exchange
END
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