TIDMUBI
RNS Number : 4071L
Ubisense Group PLC
04 September 2012
Highlights
----------------------------------------------------------------------------------
Ubisense Group plc
Interim results for the six months ended 30 June 2012
Ubisense Group plc ("Ubisense" or the "Company") (LSE:
UBI), a market leader in location based smart technology,
has announced its interim results for the six months
ended 30 June 2012.
==================================================================================
Financial
highlights * Revenue increased 6.2% to GBP12.0m (H1 2011:
GBP11.3m) and 12.8% excluding one-off 2011 pass
through revenues of GBP0.7m
* RTLS revenues grew 18.7% after pass through (9.5%
reported)
* Geospatial revenues grew 9.8% after pass through
(4.3% reported)
* Improved gross margin of 34.7% (H1 2011: 31.7%)
* Adjusted EBITDA* loss of GBP0.2m (H1 2011: GBP0.4m
profit) reflecting investment in product development
and marketing
* Reported operating loss of GBP0.8m (H1 2011: GBP0.1m
loss)
* Adjusted diluted loss per share** 3.1p (H1 2011: 0.4p
profit)
* Net cash of GBP3.3m
============== ==================================================================
Operational
highlights * 4 new key contract wins including a major strategic
win at AGCO
* 6 key follow on orders, including from Airbus and BMW
* Expansion of Atlas Copco pilot programme with major
manufacturers
* Increased investment in applications development in
both divisions
* Double Queen's Award winner for Innovation and
International Trade
============== ==================================================================
Richard Green, Chief Executive, commented,
"The Group has had a good first six months of 2012.
The number of opportunities in high value manufacturing
for the RTLS business continues to increase and we
are seeing a significant acceleration in activity
through our relationship with Atlas Copco. Given our
robust pipeline and the momentum we see, we remain
confident in the long term prospects for the business."
* Measured as operating profit excluding depreciation,
amortisation, share-based payments charge and non-recurring
costs such as AIM listing expenses and acquisition
costs.
** Earnings measured as profit for the period excluding
amortisation on acquired intangible assets, share-based
payments charge and non-recurring costs such as AIM
listing expenses and acquisition costs.
==================================================================================
Contact
Ubisense Group plc Tel: + 44 (0) 1223 535170
Richard Green
Gordon Campbell
Canaccord Genuity Limited Tel: +44 (0) 20 7523 8000
(NOMAD)
Simon Bridges
Kit Stephenson
FTI Consulting Tel: +44 (0) 20 7831 3113
James Melville-Ross
Jon Snowball
====================================== ==========================================
About Ubisense
Ubisense is a market leader in location based smart
technology which enables companies to optimise their
business processes. By keeping track of key assets,
Ubisense solutions bring clarity to complex operations
in industries while also improving quality and reliability.
Ubisense uses a unique combination of advanced industry
knowledge and an experienced team to deliver effective
and superior solutions that offer unprecedented visibility,
control and accuracy, delivering time and cost savings.
Ubisense solutions are easy to implement and flexible
to a particular business' needs, no matter which area
of the globe they operate in.
Ubisense offers two location-oriented products, RTLS
(Real-Time Location Systems) and Geospatial Solutions,
which operate in a number of industries ranging from
manufacturing and utilities to telecommunications
and is used by a number of blue chip customers across
the world, including Airbus, Aston Martin, BMW, Cummins,
Deutsche Telekom and Duke Energy.
Ubisense is headquartered in Cambridge, UK, with offices
in the USA, Canada, France, Germany, Korea and Singapore.
For more information visit: www.ubisense.net.
-------------------------------------------------------------
Interim management report
------------------------------------------------------------
Overview
In a challenging macroeconomic environment, Ubisense
increased revenues by 6.2% to GBP12.0 million in the
first half of 2012 (H1 2011: GBP11.3 million). The
revenue growth is 12.8% after excluding one-off nil
margin revenues totalling GBP0.7 million where third
party products and services were provided to customers
on a pass-through basis in the first half of 2011.
Weakness in the Euro had a negative impact on the
consolidated result, lowering the year on year growth
by around 3.4%.
As reported in July, the Company experienced short-term
delays with a small number of orders in the North
American market during the latter stages of H1. In
some cases, the delays were a result of longer negotiation
processes due to a widening in the scope of contracts.
It is pleasing to report that since the period end
the majority of these orders have been received.
During the period, Ubisense has continued to invest
significantly in its long-term strategy through product
innovation, marketing, recruitment and strategic partner
programmes. Total headcount at 30 June 2012 was 186
(June 2011: 132; December 2011: 172).
As a result of these continued investments, our Adjusted
EBITDA for the period was a loss of GBP0.2 million
compared to a profit of GBP0.4 million for the same
period in 2011. The Board views RTLS revenue growth
and Adjusted EBITDA as the most appropriate measures
of underlying trading performance.
Strategy
The opportunities for Ubisense continue to be significant
and the Group continues to grow in an agile and prudent
way. The Board's focus is on growing the business
by extending our presence in priority G7 markets,
particularly in the key Asian markets of Korea and
Japan, and to capture new customers through new strategic
partnerships, similar to our partnership with Atlas
Copco. Our aim is to create long lasting customer
relationships with major global businesses in high
value markets.
The Board continues to evaluate suitable acquisition
opportunities in this area to enhance its product
offering and customer base.
The RTLS division continues to expand its presence
in the manufacturing industry, through the EADS Group,
the automotive OEMs and other large international
groups such as AGCO. Ubisense's RTLS solutions also
have the potential to be used extensively in a number
of different industries, for example through a strategic
partnership with S3-ID selling to Agip in the Oil
& Gas sector.
The Geospatial division has the opportunity to establish
a leadership position in the Geospatial industry through
accretive investment in new geographic territories
and complementary intellectual property.
------------------------------------------------------------
Operating and financial review
RTLS
RTLS's revenues increased by 9.5% to GBP4.3 million
(H1: 2011: GBP3.9 million). Excluding pass-through
revenues in the first half of 2011 of GBP0.3 million,
the growth was 18.7%. The high gross margins on RTLS
revenue remained steady at 49.5% (H1 2011: 49.8%).
Adjusted EBITDA was marginally up at GBP65,000 (H1
2011: GBP45,000). The RTLS division continued to invest
in the Atlas Copco relationship who importantly accelerated
the support of their pilot programme, which is now
running across many organisations including five of
the largest car manufacturers in the world. Since
the period end, and as announced separately today,
this momentum has continued with significant first
orders from two major automotive OEMs. Headcount increases
in our sales and delivery teams, as well as our R&D
team to expand our range of RTLS applications, resulted
in headcount reaching 71 at the end of June 2012 (H1
2011: 63).
Geospatial
Geospatial revenues increased by 4.3% to GBP7.7 million
(2011: GBP7.4 million). Excluding pass-through revenues
in the first half of 2011 of GBP0.4 million, growth
was 9.8% driven by the InMaps and Realworld acquisitions
made in the second half of 2011. Gross margins improved
to 26.6% (H1 2011: 22.2%) as a result of some higher
margin product sales and a reduction in the number
of contractors being used in the business.
Adjusted EBITDA was stable at GBP1.3 million (H1 2011:
GBP1.3 million) with the increased gross profit being
offset by increased R&D and pre-sales expense, as
well as costs associated with the integration of the
two acquisitions made in the last quarter of 2011.
Total Geospatial headcount was 95 (H1 2011: 57), 32
of the increase since last year relates to the acquisitions.
We are pleased that both acquisitions, Realworld (now
Geospatial Systems Limited) and InMaps (now merged
into Ubisense Inc), are performing in line with expectations.
Central
Central corporate costs were GBP1.6 million (H1 2011:
GBP1.0 million) resulting in an overall EBITDA loss
of GBP0.2 million. Included in that increase was a
net foreign exchange loss of GBP0.1 million (H1 2011:
GBP0.1 million gain). The underlying increase in central
corporate costs was due to an increase in headcount
(20 compared to 12 at the same time last year), marketing
and costs relating to being a listed company.
Group operating profit and profit after tax
The operating loss for the period was GBP0.8 million
(H1 2011: GBP0.1 million) including amortisation and
depreciation charges of GBP0.6 million (H1 2011: GBP0.2
million) as a result of amortisation on the intangible
assets acquired with Realworld and InMaps in the second
half of 2011 and increased amortisation charges on
capitalised development costs as investment in R&D
increases.
Net interest receivable for the period was GBP14,000
(H1 2011: GBP172,000 expense) with interest expense
being virtually eliminated following the conversion
of the Convertible Loans and repayment of the bank
loan at the time of the IPO in June 2011. Surplus
cash is invested with the primary aim of capital maintenance;
the Company's treasury policy includes strict counterparty
limits and only with counterparties with high credit
ratings.
Reported loss before tax was GBP0.8 million (H1 2011:
GBP0.3 million loss).
The Group has a net tax expense of GBP46,000, almost
entirely a result of deferred tax on capitalised development
costs and acquired intangible assets. In the period
ended June 2011, we had a net tax credit of GBP66,000
which included a current tax credit of GBP95,000 in
respect of R&D tax credits. We account for R&D tax
credits on prudent cash received basis and expect
to receive a similar credit in the second half of
this year. Excluding the R&D tax credits receipt,
management's best estimate of the effective current
tax rate is nil due to the availability of prior years
losses.
EPS and dividend
Adjusted diluted loss per share was 3.1 pence (H1
2011: 0.4 pence profit). Reported basic and diluted
loss per share was 4.0 pence (H1 2011: 1.6 pence loss).
The Board do not feel it appropriate at this time
to pay an interim dividend. The cash balance held
on the balance sheet will be used to fund growth,
R&D and potential acquisitions in line with the strategy
set out when listing on AIM in June 2011.
Balance sheet and cash
The Group has a robust balance sheet with Shareholder
Funds at 30 June 2012 of GBP18.4 million (31 December
2011: GBP19.2 million), including net cash of GBP3.3
million (31 December 2011: GBP6.0 million) and no
debt.
The main components to the cash movements in the first
six months of 2012 include operating cash outflow
of GBP1.5 million (H1 2011: GBP2.9 million outflow),
capital investment in product development and plant
and equipment of GBP1.0 million (H1 2011: GBP0.5 million)
and contingent consideration paid of GBP0.2 million
in respect of the Realworld acquisition made in October
2011.
Capital structure
The issued share capital at 30 June 2012 was 21,801,967
(December 2011: 21,657,698) ordinary shares of GBP0.02
each. The increase of 144,269 shares relates entirely
to share option exercises by employees. In addition,
347,000 share options were granted to employees on
29 June 2012 at an exercise price of GBP2.125, being
the share price at the time. The total number of unexercised
share options at 30 June 2012 was 2,093,720.
Current trading and outlook
Ubisense enters the second half of 2012 with increasing
momentum in the business. With a strong order book
and robust pipeline, improved financial performance
is anticipated in the second half of 2012. We continue
to expect revenue growth year-on-year and profits
similar to 2011.
---------------------------------------------------------------
Interim income statement
---------------------------------------------------------------------------------
For the six months ended 30 June 2012
================================================================================
Six months Six months 12 months
to 30 to 30 to 31
June June December
2012 2011 2011
unaudited unaudited audited
Notes GBP'000 GBP'000 GBP'000
---------------------------------- ------ ----------- ----------- ----------
Revenue 6 11,950 11,255 23,785
Cost of sales (7,799) (7,684) (15,308)
================================== ====== =========== =========== ==========
Gross profit 4,151 3,571 8,477
Administrative expenses (4,995) (3,719) (8,188)
================================== ====== =========== =========== ==========
Operating (loss)/profit 6 (844) (148) 289
Analysed as:
Gross profit 4,151 3,571 8,477
Other administrative expenses (4,377) (3,156) (7,029)
================================== ====== =========== =========== ==========
Adjusted EBITDA (226) 415 1,448
Depreciation (100) (60) (140)
Amortisation of acquired
intangible assets (128) - (112)
Amortisation of other intangible
assets (369) (171) (512)
Share-based payments charge (21) (8) (24)
AIM listing expenses - (324) (324)
Acquisition costs - - (47)
================================== ====== =========== =========== ==========
Operating (loss)/profit 6 (844) (148) 289
Finance income 7 15 8 37
Finance costs 7 (1) (180) (185)
---------------------------------- ------ ----------- ----------- ----------
(Loss)/profit before tax (830) (320) 141
---------------------------------- ------ ----------- ----------- ----------
Income tax 8 (46) 66 (107)
---------------------------------- ------ ----------- ----------- ----------
(Loss)/profit for the period
attributable to the equity
shareholders of the Company (876) (254) 34
---------------------------------- ------ ----------- ----------- ----------
Earnings per share (pence)
---------------------------------- ------ ----------- ----------- ----------
Basic 9 (4.0p) (1.6p) 0.2p
Diluted 9 (4.0p) (1.6p) 0.2p
---------------------------------- ------ ----------- ----------- ----------
The notes 1 to 17 are an integral part of these condensed
interim financial statements.
Interim statement of comprehensive income
-----------------------------------------------------------------------------
For the six months ended 30 June 2012
============================================================================
Six months Six months 12 months
to 30 to 30 to 31
June June December
2012 2011 2011
unaudited unaudited audited
GBP'000 GBP'000 GBP'000
-------------------------------------- ----------- ----------- ----------
(Loss)/profit for the period (876) (254) 34
Other comprehensive income:
Exchange difference on retranslation
of net assets and results of
overseas subsidiaries (30) 66 14
Total comprehensive income
attributable to equity shareholders
of the Company (906) (188) 48
-------------------------------------- ----------- ----------- ----------
The notes 1 to 17 are an integral part of these condensed
interim financial statements.
Interim statement of changes in equity
--------------------------------------------------------
For the six months ended 30 June 2012
=====================================================
Share Share Other Retained
capital premium reserves earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
============================= ========== ========= ========== ========== =========
Balance at 1 January
2012 (audited) 433 22,031 510 (3,736) 19,238
============================== ========= ========= ========== ========== =========
Loss for the period - - - (876) (876)
Exchange difference
on retranslation
of net assets and
results of overseas
subsidiaries - - (30) - (30)
============================== ========= ========= ========== ========== =========
Total comprehensive
income for the period - - (30) (876) (906)
Reserve credit for
equity-settled share-based
payment - - 21 - 21
Issue of new share
capital 3 - - - 3
Premium on new share
capital - 25 - - 25
Transactions with
owners 3 25 21 - 49
============================== ========= ========= ========== ========== =========
Balance at 30 June
2012 (unaudited) 436 22,056 501 (4,612) 18,381
============================== ========= ========= ========== ========== =========
Share Share Other Retained
capital premium reserves earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
============================= ========== ========= ========== ========== ==========
Balance at 1 January
2011 (audited) 3042 14,550 953 (4,272) 11,535
============================== ========= ========= ========== ========== ==========
Loss for the period - - - (254) (254)
Exchange difference
on retranslation
of net assets and
results of overseas
subsidiaries - - 66 - 66
============================== ========= ========= ========== ========== ==========
Total comprehensive
income for the period - - 66 (254) (188)
Reserve credit for
equity-settled share-based
payment - - 134 - 134
Equity component
of loans - - (502) 502 -
Issue of new share
capital 129 - - - 129
Premium on new share
capital - 7,968 - - 7,968
Share issue costs - (591) - - (591)
============================== ========= ========= ========== ========== ==========
Transactions with
owners 129 7,377 (368) 502 7,640
============================== ========= ========= ========== ========== ==========
Balance at 30 June
2011 (unaudited) 433 21,927 651 (4,024) 18,987
============================== ========= ========= ========== ========== ==========
A reconciliation of the components of Other reserves
is given in note 15.
The notes 1 to 17 are an integral part of these condensed
interim financial statements.
Interim statement of financial position
----------------------------------------------------------------------------------
At 30 June 2012
=================================================================================
At 30 At 30 At 31
June June December
2012 2011 2011
unaudited unaudited audited
Notes GBP'000 GBP'000 GBP'000
------------------------------- ------ ----------- ----------- ----------
Assets
Non-current assets
Goodwill 7,418 6,069 7,418
Other intangible assets 10 2,550 752 2,258
Property, plant and equipment 1 476 299 366
=============================== ====== =========== =========== ==========
Total non-current assets 10,444 7,120 10,042
=============================== ====== =========== =========== ==========
Current assets
Inventories 1,115 784 1,667
Trade and other receivables 11 8,508 7,774 9,498
Cash and cash equivalents 3,324 8,077 6,034
=============================== ====== =========== =========== ==========
Total current assets 12,947 16,635 17,199
=============================== ====== =========== =========== ==========
Total assets 23,391 23,755 27,241
=============================== ====== =========== =========== ==========
Liabilities
Current liabilities
12,
Trade and other payables 13 (4,254) (4,587) (7,294)
=============================== ====== =========== =========== ==========
Total current liabilities (4,254) (4,587) (7,294)
=============================== ====== =========== =========== ==========
Non-current liabilities
Deferred tax liability (596) (181) (549)
13
Other liabilities 4 (160) - (160)
=============================== ====== =========== =========== ==========
Total non-current liabilities (756) (181) (709)
=============================== ====== =========== =========== ==========
Total liabilities (5,010) (4,768) (8,003)
=============================== ====== =========== =========== ==========
Net assets 18,381 18,987 19,238
=============================== ====== =========== =========== ==========
Equity
Equity attributable to owners
of the parent company
Share capital 14 436 433 433
Share premium account 22,056 21,927 22,031
Other reserves 15 501 651 510
Retained earnings (4,612) (4,024) (3,736)
=============================== ====== =========== =========== ==========
Total equity 18,381 18,987 19,238
=============================== ====== =========== =========== ==========
The notes 1 to 17 are an integral part of these condensed
interim financial statements.
Interim statement of cash flows
------------------------------------------------------------------------------
For the six months ended 30 June 2012
=============================================================================
Six months Six months 12 months
to 30 to 30 to 31
June June December
2012 2011 2011
unaudited unaudited audited
Notes GBP'000 GBP'000 GBP'000
------------------------------- ------ ----------- ----------- ----------
(Loss)/profit before tax (830) (320) 141
Adjustments for:
Depreciation 100 60 140
Amortisation 497 171 624
Share-based payments charge 21 8 24
Finance income 7 (15) (8) (37)
Finance costs 7 1 180 185
Foreign exchange differences 60 19 12
------------------------------- ------ ----------- ----------- ----------
Operating cash flows before
working capital movements (166) 110 1,089
Change in inventories 552 (420) (1,303)
Change in receivables 1,004 (880) (2,065)
Change in payables (2,858) (1,844) (108)
------------------------------- ------ ----------- ----------- ----------
Cash generated by operations
before tax (1,468) (3,034) (2,387)
------------------------------- ------ ----------- ----------- ----------
Net income taxes received 1 107 102
------------------------------- ------ ----------- ----------- ----------
Net cash flows from operating
activities (1,467) (2,927) (2,285)
------------------------------- ------ ----------- ----------- ----------
Cash flows from investing
activities
Acquisition of subsidiaries,
net of cash acquired 13 (200) - (1,600)
Purchases of property,
plant and equipment (210) (146) (256)
Purchases of intangible
assets (789) (340) (1,130)
Interest received 15 8 33
------------------------------- ------ ----------- ----------- ----------
Net cash flows from investing
activities (1,184) (478) (2,953)
------------------------------- ------ ----------- ----------- ----------
Cash flows from financing
activities
Repayment of borrowings - (892) (1,014)
Interest paid (1) (42) (47)
Proceeds from the issue
of share capital 14 28 5,238 5,238
------------------------------- ------ ----------- ----------- ----------
Net cash flows from financing
activities 27 4,304 4,177
Net increase in cash and
cash equivalents (2,624) 899 (1,061)
Cash and cash equivalents
at start of period 6,034 7,130 7,130
Exchange differences on cash
and cash equivalents
7 (86) 48 (35)
--------------------------------------- ----------- ----------- ----------
Cash and cash equivalents
at end of period 3,324 8,077 6,034
------------------------------- ------ ----------- ----------- ----------
The notes 1 to 17 are an integral part of these condensed
interim financial statements.
Notes to the interim financial statements
--------------------------------------------------------------
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, USA, Canada, France,
Germany, Korea and Singapore and sells mainly in the
USA and Europe.
The Company is a public limited company which is listed
on the Alternative Investment Market ('AIM') of the
London Stock Exchange (UBI) and is incorporated and
domiciled in the UK. The address of its registered
office is St. Andrew's House, St. Andrew's Road, Chesterton,
Cambridge, CB4 1DL.
The condensed consolidated interim financial statements
were approved by the Board of Directors for issue
on 3 September 2012.
The condensed consolidated interim financial statements
do not comprise statutory accounts within the meaning
of section 434 of the Companies Act 2006. Statutory
accounts for the year ended 31 December 2011 were
approved by the Board of Directors on 19 March 2012
and 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 condensed consolidated interim financial statements
have been reviewed, not audited.
2 Basis of preparation
===========================================================
The condensed consolidated interim financial statements
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 condensed consolidated interim financial
statements.
3 Accounting policies
==============================================================
The accounting policies adopted in the preparation
of the condensed consolidated interim financial statements
are unchanged from those set out in the Group's consolidated
financial statements for the year ended 31 December
2011. These policies have been consistently applied
to all the periods presented.
The operations of the Group are not subject to significant
seasonality.
4 Estimates
===========================================================
The preparation of interim 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.
In preparing these condensed consolidated interim
financial statements, the significant judgements made
by management in applying the Group's accounting policies
and the key sources of estimation and uncertainty
were the same as those that applied to the consolidated
financial statements for the year ended 31 December
2011.
5 Risks and uncertainties
==============================================================
An outline of the key risks and uncertainties faced
by the Group was described in the 2011 financial statements,
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 and 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
Chief Operating Decision Maker is the Chief Executive
Officer.
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 such as AIM listing expenses and acquisition
costs, finance income and expense and income taxes.
Six months ended 30 June RTLS Geospatial Central Total
2012 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------- --------- ----------- --------- ---------
Revenue 4,259 7,691 - 11,950
Cost of sales (2,152) (5,647) - (7,799)
=============================== ========= =========== ========= =========
Gross profit 2,107 2,044 - 4,151
Other administrative expenses (2,042) (752) (1,583) (4,377)
=============================== ========= =========== ========= =========
Adjusted EBITDA 65 1,292 (1,583) (226)
Depreciation - - (100) (100)
Amortisation of acquired
intangible assets - (128) - (128)
Amortisation of other
intangible assets (248) (77) (44) (369)
Share-based payments charge - - (21) (21)
Operating (loss)/profit (183) 1,087 (1,748) (844)
Finance income - - 15 15
Finance costs - - (1) (1)
=============================== ========= =========== ========= =========
(Loss)/profit before tax (183) 1,087 (1,734) (830)
=============================== ========= =========== ========= =========
Six months ended 30 June RTLS Geospatial Central Total
2011 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------- --------- ----------- --------- ---------
Revenue 3,888 7,367 - 11,255
Cost of sales (1,951) (5,733) - (7,684)
=============================== ========= =========== ========= =========
Gross profit 1,937 1,634 - 3,571
Other administrative expenses (1,892) (292) (972) (3,156)
=============================== ========= =========== ========= =========
Adjusted EBITDA 45 1,342 (972) 415
Depreciation - - (60) (60)
Amortisation of other
intangible assets (164) - (7) (171)
Share-based payments charge - - (8) (8)
AIM listing expenses - - (324) (324)
=============================== ========= =========== ========= =========
Operating (loss)/profit (119) 1,342 (1,371) (148)
Finance income - - 8 8
Finance costs - - (180) (180)
=============================== ========= =========== ========= =========
(Loss)/profit before tax (119) 1,342 (1,543) (320)
=============================== ========= =========== ========= =========
12 months ended 31 December RTLS Geospatial Central Total
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 of acquired
intangible assets - (112) - (112)
Amortisation of other
intangible assets (437) (57) (18) (512)
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 (loss) before tax 265 2,932 (3056) 141
=============================== ========= =========== ========= =========
7 Finance income and costs
=== =================================================================
Six months Six months 12 months
to 30 to 30 to 31
June June December
2012 2011 2011
unaudited unaudited audited
GBP'000 GBP'000 GBP'000
--------------------------- ----------- ----------- ----------
Interest income from cash
and cash equivalents 15 8 37
=============================== =========== =========== ==========
Finance income 15 8 37
=============================== =========== =========== ==========
Six months Six months 12 months
to 30 to 30 to 31
June June December
2012 2011 2011
unaudited unaudited audited
GBP'000 GBP'000 GBP'000
--------------------------- ----------- ----------- ----------
Interest payable - bank (1) (21) (26)
Interest payable - other
loans - (159) (159)
=========================== =========== =========== ==========
Finance costs (1) (180) (185)
--------------------------- ----------- ----------- ----------
Finance costs for the six months ended 30 June 2011
and the twelve months ended 31 December 2011 included
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.
8 Income tax
=== =========================================================================
At 30 At 30 At 31
June June December
2012 2011 2011
unaudited unaudited audited
GBP'000 GBP'000 GBP'000
----------------------------------- ----------- ----------- ----------
Current tax credit 1 95 133
Deferred tax expense (47) (29) (240)
Total income tax (expense)/credit (46) 66 (107)
--------------------------------------- ----------- ----------- ----------
Income tax is recognised based on management's estimate
of the weighted average annual income tax rate expected
for the full financial year.
The current income tax credit for the periods ended
June and December 2011 principally arises due to the
receipt of R&D tax credit relief in respect of the
prior year. The Group's policy is to recognise tax
credits resulting from R&D claims on a cash received
basis. A tax credit has not been recognised in the
period ended 30 June 2012 in respect of the claim
for the 2011 financial year.
9 Earnings per share
=== =============================================================================
Six months Six months 12 months
to 30 to 30 to 31
June June December
2012 2011 2011
unaudited unaudited audited
--------------------------------------- ----------- ----------- ----------
Earnings
(Loss)/profit for the period
(GBP'000) (876) (254) 34
=========================================== =========== =========== ==========
Earnings for the purposes of
diluted earnings per share (GBP'000) (876) (254) 34
=========================================== =========== =========== ==========
Number of shares
Basic weighted average
number of shares ('000) 21,725 16,182 18,897
Effect of dilutive potential
ordinary shares:
* Share options ('000) 1,527 1,572 1,566
* Warrants ('000) 15 45 57
=========================================== =========== =========== ==========
Diluted weighted average
number of shares ('000) 23,267 17,799 20,520
=========================================== =========== =========== ==========
Basic earnings per share
(pence) (4.0p) (1.6p) 0.2p
=========================================== =========== =========== ==========
Diluted earnings per share
(pence) (4.0p) (1.6p) 0.2p
=========================================== =========== =========== ==========
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, Convertible Loans and warrants. Options
have no dilutive effect in loss-making years, and
hence the diluted loss per share for the periods ended
June 2012 and 2011 is the same as the basic loss per
share.
The Group also presents an adjusted diluted earnings
per share figure which excludes amortisation on acquired
intangible assets, share-based payments charge, and
non-recurring expenditure such as AIM listing expenses
and acquisition costs from the measurement of profit
for the period.
Diluted earnings per share amounts are calculated
by dividing the net profit attributable to ordinary
equity holders by the weighted average number of ordinary
shares outstanding during the year (adjusted for the
effects of dilutive options and the Group's convertible
bonds).
Six months Six months 12 months
to 30 to 30 to 31
June June December
Adjusted diluted earnings 2012 2011 2011
per share unaudited unaudited audited
--------------------------------------- ----------- ----------- ----------
Earnings for the purposes of
diluted earnings per share (GBP'000) (876) (254) 34
Adjustments
Reversal of amortisation on
acquired intangible assets (GBP'000) 128 - 112
Reversal of share-based payments
charge (GBP'000) 21 8 24
Reversal of AIM listing expenses
(GBP'000) - 324 324
Reversal of acquisition costs
(GBP'000) - - 47
======================================= =========== =========== ==========
Net adjustments (GBP'000) 149 332 507
--------------------------------------- ----------- ----------- ----------
Adjusted earnings (GBP'000) (727) 78 541
--------------------------------------- ----------- ----------- ----------
Adjusted diluted earnings
per share (pence) (3.1p) 0.4p 2.6p
--------------------------------------- ----------- ----------- ----------
10 Other intangible assets
==== =======================================================================
At 30 At 30 At 31
June June December
2012 2011 2011
unaudited unaudited audited
Net book amount GBP'000 GBP'000 GBP'000
--------------------------------- ----------- ----------- ----------
Capitalised development
costs 1,583 693 1,127
Software 229 59 265
Acquired software products 396 - 485
Acquired customer relationships
and backlog 342 - 381
-------------------------------------- ----------- ----------- ----------
Total other intangible
assets 2,550 752 2,258
-------------------------------------- ----------- ----------- ----------
11 Trade and other receivables
==== =========================================================================
At 30 At 30 At 31
June June December
2012 2011 2011
unaudited unaudited audited
GBP'000 GBP'000 GBP'000
----------------------------------- ----------- ----------- ----------
Trade receivables, gross 4,211 4,075 7,541
Allowances for credit losses (34) (40) (7)
======================================== =========== =========== ==========
Trade receivables, net 4,177 4,035 7,534
Amounts recoverable on
contracts 3,512 2,943 1,588
Other receivables 26 135 21
Prepayments and accrued
income 751 413 314
VAT and taxation receivable 42 248 41
---------------------------------------- ----------- ----------- ----------
Total trade and other receivables 8,508 7,774 9,498
---------------------------------------- ----------- ----------- ----------
12 Trade and other payables
==== =============================================================================
At 30 At 30 At 31
June June December
2012 2011 2011
unaudited unaudited audited
Note GBP'000 GBP'000 GBP'000
-------------------------------- ----- ----------- ----------- ----------
Payments received on account 1,069 541 1,995
Trade payables 1,032 2,022 2,110
Trade accruals 1,193 1,378 1,633
Other taxation and social
security 413 556 817
Other payables 347 90 339
Other liabilities - contingent
consideration 13 200 - 400
------------------------------------- ----- ----------- ----------- ----------
Total trade and other payables 4,254 4,587 7,294
------------------------------------- ----- ----------- ----------- ----------
13 Other liabilities - contingent consideration
==== ==========================================================================
At 30 At 30 At 31
June June December
2012 2011 2011
unaudited unaudited audited
Note GBP'000 GBP'000 GBP'000
============================= ===== =========== =========== ==========
Non-current 160 - 160
Current 12 200 - 400
---------------------------------- ----- ----------- ----------- ----------
Total other liabilities
- contingent consideration 360 - 560
---------------------------------- ----- ----------- ----------- ----------
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 nil and GBP1,150,000. A
liability of GBP560,000 was recognised upon acquisition
on 4 October 2011, based on management's best estimate
of the probability-adjusted expected cash outflow
from the arrangement.
GBP200,000 was paid in the period to June 2012 and
a further GBP200,000 has been paid since the period
end, both in respect of the first milestone. The amount
recognised for the second milestone is unchanged based
on the most recent management estimates.
14 Share capital
==== ==================================================================
At 30 At 30 At 31
June June December
2012 2011 2011
Allotted, called-up and unaudited unaudited audited
fully paid GBP'000 GBP'000 GBP'000
---------------------------- ----------- ----------- ----------
Ordinary shares of GBP0.02
each 436 433 433
--------------------------------- ----------- ----------- ----------
At 30 At 30 At 31
June June December
2012 2011 2011
unaudited unaudited audited
Movement in number of shares '000 '000 '000
---------------------------------- ------------ ------------ -----------
Number of shares at beginning
of period 21,657,698 15,211,490 15,211,490
---------------------------------- ------------ ------------ -----------
Share issue on Initial
Public Offering - 2,777,778 2,777,778
Issued under share-based
payment plans 144,269 374,308 376,308
Issued on conversion of
Convertible Loan - 3,176,772 3,176,772
Issued on exercise of warrants - 115,350 115,350
================================== ============ ============ ===========
Change in number of shares
in period 144,269 6,444,208 6,446,208
================================== ============ ============ ===========
Number of shares at end
of period 21,801,967 21,655,698 21,657,698
---------------------------------- ------------ ------------ -----------
During the period, the Company issued 144,269 shares
increasing the total number of shares in issue from
21,657,698 to 21,801,967 as a result of options exercised
with a weighted average exercise price of GBP0.20
per share for total cash consideration of GBP28,327.
15 Other reserves
=== ===============
Share-based
payment Translation
reserve reserve Total
GBP'000 GBP'000 GBP'000
----------------------------------- ------------ ------------ ---------
Balance at 1 January 2012
(audited) 591 (81) 510
----------------------------------- ------------ ------------ ---------
Exchange difference on
retranslation of net assets
and results of overseas
subsidiaries - (30) (30)
Reserve credit for equity-settled
share-based payment 21 - 21
Balance at 30 June 2012
(unaudited) 612 (111) 501
=================================== ============ ============ =========
Equity
component
of convertible Share-based
loans payment Translation
and warrants reserve reserve Total
GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------- ---------------- ------------ ------------ ---------
Balance at 1 January 2011
(audited) 502 546 (95) 953
----------------------------------- ---------------- ------------ ------------ ---------
Exchange difference on
retranslation of net assets
and results of overseas
subsidiaries - - 66 66
Reserve credit for equity-settled
share-based payment - 134 - 134
Equity component of loans (502) - - (502)
Balance at 30 June 2011
(unaudited) - 680 (29) 651
=================================== ================ ============ ============ =========
16 Cautionary statement
=== ===========================================================
This document contains certain forward-looking statements
with respect of the financial condition, results,
operations and businesses of Ubisense Group plc. These
statements and forecasts involve risk and uncertainty
because they relate to events and depend on circumstances
that will occur in the future. There are a number
of factors that could cause the actual results or
developments to differ materially from those expressed
or implied by these forward looking statements and
forecasts. Nothing in this document should be construed
as a profit forecast.
17 Copies of interim financial statements
--- -----------------------------------------------------------
Copies of the interim financial statements are available
from the Company at its registered office at St. Andrew's
House, St. Andrew's Road, Chesterton, Cambridge, CB4
1DL. The interim financial statements will also be
available on the Company's website www.ubisense.net.
Independent review report to Ubisense Group plc
-----------------------------------------------------------
Introduction
We have been engaged by the Company to review the
financial information in the half-yearly financial
report for the six months ended 30 June 2012 which
comprises the Interim Income Statement, Interim Statement
of Comprehensive Income, Interim Statement of Changes
in Equity, Interim Statement of Financial Position,
Interim Statement of Cash Flows and related notes
(1 to 17). We have read the other information contained
in the half-yearly financial report and considered
whether it contains any apparent misstatements or
material inconsistencies with the information in the
condensed set of financial statements.
This report is made solely to the Company in accordance
with guidance contained in ISRE (UK and Ireland) 2410,
'Review of Interim Financial Information performed
by the Independent Auditor of the Entity'. Our review
work has been undertaken so that we might state to
the Company those matters we are required to state
to them in a review report and for no other purpose.
To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than
the Company, for our review work, for this report,
or for the conclusion we have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility
of, and has been approved by, the Directors. The AIM
rules of the London Stock Exchange require that the
accounting policies and presentation applied to the
financial information in the half-yearly financial
report are consistent with those which will be adopted
in the annual accounts having regard to the accounting
standards applicable for such accounts. As disclosed
in Note 2, the annual financial statements of the
Group are prepared in accordance with IFRSs as adopted
by the European Union. The financial information in
the half-yearly report has been prepared in accordance
with the basis in Note 2.
Our responsibility
Our responsibility is to express to the Company a
conclusion on the financial information in the half-
yearly financial report based on our review.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410,
'Review of Interim Financial Information Performed
by the Independent Auditor of the Entity', issued
by the Auditing Practices Board for use in the United
Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons
responsible for financial and accounting matters,
and applying analytical and other review procedures.
A review is substantially less in scope than an audit
conducted in accordance with International Standards
on Auditing (UK and Ireland) and consequently does
not enable us to obtain assurance that we would become
aware of all significant matters that might be identified
in an audit. Accordingly, we do not express an audit
opinion.
Conclusion
Based on our review, nothing has come to our attention
that causes us to believe that the financial information
in the half-yearly financial report for the six months
ended 30 June 2012 is not prepared, in all material
respects, in accordance with the basis of accounting
described in Note 2.
Grant Thornton UK LLP
Chartered Accountants
Registered Auditor
Cambridge
3 September 2012
This information is provided by RNS
The company news service from the London Stock Exchange
END
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