Interim Results
10 Fevereiro 2003 - 5:00AM
UK Regulatory
RNS Number:2226H
Systems Integrated Research PLC
10 February 2003
Chairman's Statement
Financial
In the six months ended 30 November 2002 the Group achieved a profit before
taxation of #18,000, compared to a profit before taxation of #39,000 for the
corresponding period last year.
Turnover for the six months was #553,000, a reduction of 18% compared to a
turnover of #674,000 for the corresponding period last year. Gross margin
percentage levels to turnover remain high at 98%. During the latter part of the
last financial year, the Group recognised the slow down in income and took
appropriate action to reduce the base overheads, this has resulted in a
reduction in overheads of #97,000 for the period, to #517,000 compared to
#614,000 in the same period last year.
Associated undertaking
During the period the Group has sold its 29% interest in the ordinary shares of
Times Learning Systems Pte Limited to their holding company Times Publishing
Limited. As part of the agreement we have retained the joint rights on all the
products developed to date in the associated undertaking for #39,000. This has
resulted in the Group saving shared annual development costs of approximately
#60,000 per annum, whilst retaining the jointly developed product portfolio.
Product development - "National Curriculum Tests"
As reported in the Preliminary Results statement on 17 July 2002, the Group
signed an agreement with the Qualifications and Curriculum Authority (QCA),
allowing the Group to use the content of Year One to Year Nine test papers for
Mathematics, English and Science for a new product development.
The Group has developed a product called "National Curriculum Tests". I
reported in the Preliminary results that the planned launch of the new product
would be during the autumn of 2002, unfortunately, the product development has
taken longer than anticipated. The product was launched at the recent BETT 2003
education exhibition and is expected to be available for shipment during March
2003.
Markets
The Government has recently launched its delayed Curriculum Online initiative,
which will bring #50 million of dedicated funding into the market in the next
twelve months. However, an announcement was also recently made that the BBC
would be providing free online learning content to schools. The latter
announcement has led to a significant amount of uncertainty in the marketplace,
as a result of which the Group is reviewing its future development policy.
Interim financial statements - basis of preparation
The interim financial statements have been prepared on the going concern basis,
which assumes that the Group will continue in operational existence for the
foreseeable future. The directors of the Group have prepared projected cash
flow information for the period ending 31 December 2003. These projections
indicate that current cash balances will be sufficient for the Group to meet its
projected cash requirements throughout this period. However, the nature of the
Group's business is such that the cash flows are dependent on obtaining new
orders and there can be considerable variation in the timing of cash flows. It
should be noted that the cash flow projections depend on a significant order
from a major customer during the third quarter of this calendar year, and
should this order not be received the Group may require additional working
capital. Due to the uncertainty of the BBC initiative mentioned above and
current trading conditions, the cash flow projections allow for action to be
taken to reduce costs, and therefore the directors consider that it is
appropriate for the financial statements to be prepared on the going concern
basis.
C.E.Berg
10 February 2003
Consolidated Profit and Loss Account
Unaudited Unaudited Audited
6 Months to 6 months to Year to
30 Nov 30 Nov 31 May
2002 2001 2002
#'000 #'000 #'000
Turnover 553 674 1,221
Cost of sales (12) (19) (41)
Gross profit 541 655 1,180
Operating expenses (517) (614) (1,253)
Operating profit/(loss) 24 41 (73)
Investment income - interest receivable 4 14 20
Operating profit/(loss) on ordinary activities before interest 28 55 (53)
Interest payable and similar charges (10) (16) (26)
Profit/(loss) on ordinary activities before taxation 18 39 (79)
Taxation on profit/(loss) on ordinary activities - - -
Profit/(loss) for the period 18 39 (79)
Appropriation for dividends on cumulative redeemable preference (22) (22) (45)
shares held by minority
Retained (loss)/profit for the period (4) 17 (124)
(Loss)/earnings per ordinary share (0.03p) 0.13p (0.93p)
IIMR (Loss)/earnings per ordinary share (0.02p) 0.13p (0.92p)
Notes:
1. The interim results are unaudited and do not comprise full accounts within
the meaning of Section 240 of the Companies Act 1985. Full accounts for the year
ended 31 May 2002, on which the auditors gave an unqualified report, have been
delivered to the Registrar of Companies.
2. The interim results have been prepared on the basis of the accounting
policies set out in the audited accounts for the year ended 31 May 2002.
3. All figures in the profit and loss account above relate to continuing
operations.
4. No charge to UK corporation tax or deferred tax arises and there is no
charge to taxation in respect of the group's associated undertaking.
5. No interim dividend has been declared on the ordinary shares (2001: Nil).
6. The calculation of (loss)/earnings per share is based on the (loss)/profit
attributable to the shareholders and the weighted average number of ordinary
shares in issue during the period of 13,400,051 (2001: 13,400,051).
7. This announcement is being circulated to all shareholders and copies will
be available from the company's head office address listed overleaf.
8. The Group has no recognised gains or losses other than the (loss)/profit
above and therefore no separate statement of total recognised gains or losses
has been presented.
Consolidated Balance Sheet
Unaudited Unaudited Audited
30 Nov 30 Nov 31 May
2002 2001 2002
#'000 #'000 #'000
Fixed assets
Intangible assets 39 - -
Tangible assets 74 96 79
113 96 79
Current assets
Stocks 14 15 15
Debtors: amounts falling due after one year 103 46 91
Debtors: amounts falling due within one year 435 320 254
Cash at bank and in hand 146 539 521
698 920 881
Creditors: amounts falling due within one year (176) (299) (219)
Net current assets 522 621 662
Total assets less current liabilities 635 717 741
Creditors: amounts falling due after more than one year (493) (382) (483)
Deferred income (200) (293) (334)
(693) (675) (817)
Net (liabilities)/assets (58) 42 (76)
Capital and reserves
Called up share capital 134 134 134
Share premium account 3,956 3,956 3,956
Profit and loss account - deficit (5,578) (5,433) (5,574)
Total equity shareholders' funds (1,488) (1,343) (1,484)
Minority interest - non-equity 1,430 1,385 1,408
(58) 42 (76)
Notes:
1. Goodwill arising on the acquisition of subsidiaries and associates was
written off immediately against profit & loss reserves in accordance with
the transitional provisions of FRS10. The cumulative amount of goodwill
written off against profit & loss reserves is #3,442,000 (2001: #3,442,000).
2. The Group has an unrecognised deferred taxation asset in respect of trading
losses of approximately #3,250,000 carried forward, which as yet the
directors do not consider it appropriate to recognise.
Consolidated Cash Flow Statement
Unaudited Unaudited Audited
6 months to 6 months to Year to
30 Nov 30 Nov 31 May
2002 2001 2002
#'000 #'000 #'000
Net cash outflow from continuing operating activities (see
below) (327) (40) (48)
Returns on investments and servicing of finance
Net interest received/(paid) 4 (63) 19
Interest paid on hire purchase contracts - (1) (2)
4 (64) 17
Capital expenditure and financial investment
Purchase of intangible fixed assets (39) - -
Purchase of tangible fixed assets (20) (3) (22)
Sale of tangible fixed assets 7 - 13
(52) (3) (9)
Net cash outflow before financing (375) (107) (40)
Financing
Repayment of loans - (250) (327)
Repayment of principal on hire purchase contracts - (5) (13)
- (255) (340)
Decrease in cash in the period (375) (362) (380)
Reconciliation of operating profit/(loss) to net cash outflow from continuing
operating activities
Operating profit/(loss) - continuing activities 24 41 (73)
Depreciation of tangible fixed assets 17 25 47
Loss on disposal of tangible fixed assets 1 - 1
Decrease in stocks 1 5 5
(Increase)/decrease in debtors (193) 128 149
Decrease in creditors (43) (77) (56)
Decrease in deferred income (134) (162) (121)
Net cash outflow from continuing operating activities (327) (40) (48)
This information is provided by RNS
The company news service from the London Stock Exchange
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