TIDMINVU
RNS Number : 1308O
Invu plc
17 September 2013
Invu PLC
Interim Results for the six months ended 31 July 2013
Invu PLC (INVU.L, the 'Group' or the 'Company'), the document
management software provider, announces its interim results for the
six months period ended 31 July 2013 (H1 2014).
Key Financial Points
-- Revenue GBP1.36m (H1 2013: GBP1.28m)
-- Net profit GBP0.13m (H1 2013: GBP0.04m)
o Adjusted EBITDA GBP0.18m (H1 2013: GBP0.11m)
-- Net cash (cash net of borrowings) GBP1.2m (H1 2013: GBP0.6m)
Colin Gallick, Chief Executive Officer of Invu, commented:
"Our invoice processing initiative has resulted in growth in our
software and related services revenues and this growth has
contributed to our improved profitability and cash flow."
Enquiries:
Invu Plc +44 (0) 1604 859893
Colin Gallick, CEO
Ian Smith, Finance Director
WH Ireland Limited +44 (0) 117 945 3470
Mike Coe
About Invu
Invu [LSE, AIM, Symbol: INVU] develops and provides software
solutions and services to help organisations with control,
management and security of electronic documents and automation of
workflow. These solutions increase information integrity,
visibility and access across an organisation, reduce costs of paper
document storage and retrieval, provide auditable document records
management and reduce risk of non-compliance.
Invu's solutions enable automated document scan, capture,
process and archive, and integrate readily with most back office
systems, allowing tighter control of financial, HR and general
business processes.
For more information about Invu: www.invu.net
Chief Executive's Statement
Financial Performance
I am pleased to report revenue growth together with improved
profitability and cash flow.
The revenue growth, up by 6.5% to GBP1.36m, arises from a growth
in software and related services revenue which in a large part is
due to our invoice processing offering which was initially launched
in April 2012.
The profit improvement, net profit up by 269% to GBP0.133m,
arises from the revenue growth and continued improvements in the
quality of the business.
The cash flow improvement results from the combination of
improved adjusted EBITDA (earnings before interest, tax,
depreciation, amortisation, share option expenses and exceptional
costs) of GBP0.18m, (compared to GBP0.11m in H1 2013), and working
capital cash generation of GBP0.36m.
Business Performance
During the period the business has continued to be focused on,
the design, development and distribution of software that enables
customers to manage paper and electronic documents and information,
as well as business process workflow, in a simple and effective
way. We have carried out the great majority of our business in the
United Kingdom selling our own authored software, which is designed
to address the needs of small and medium sized businesses, together
with software supplied by third parties which complements our own
software offering.
During the period the accountancy market, has remained our most
significant vertical market. We address this market primarily
through a white-label agreement with IRIS, the UK's largest private
software house. IRIS is our largest reseller.
Our invoice processing solution, which enables customers to
improve both the control over and efficiency of processing a large
volume of supplier invoices, can be implemented in any industry
sector. In the period we saw new business in the Property Services,
Housing Association and E-Commerce sectors as well as business from
existing customers.
We have a large customer base and the support revenue from this
base is an important part of our revenues. In the period we
continued to maintain a high retention rate (by value) of these
customers. The retention rate is dependent on the quality of
telephone support we (and our resellers deliver) and continuing
updates to the software.
In July we made available to all customers our latest software
release. This release offers improved visibility and enhanced
functionality, the ability to further automate document processing
and significantly enhanced document sharing functionality.
The next major software release is scheduled for the second half
of the year and will include release of the Invu portal.
Outlook
We expect to continue to build on the stable base we have
established in the first half.
Colin Gallick
Chief Executive Officer
17 September 2013
Finance Review
The Consolidated Income Statement shows an operating profit of
GBP0.136m compared to a profit of GBP0.034m in the first half of
last year.
Revenue in the period was up by 6.5% at GBP1.36m compared to
GBP1.28m reported in the first half of last year.
Revenue comprises the sale of software and related
implementation and installation services, and the sale of annual
software support contracts. The Group reported sales of software
and related services of GBP0.52m (H1 2013: GBP0.44m). The revenue
arising from the sale of support contracts is recognised evenly
over the life of the contract and remained at a similar level as
last year at GBP0.84m. The key performance metric for the sale of
software support contracts is the renewal rate (by value) which was
92%, the same level as reported last year.
The cost of sales includes the direct costs of the delivery of
services which form the majority of revenue. The gross margin
percentage improved to 85.8% (H1 2013 80.7%) primarily due to a
change in our distribution mix towards IRIS from other
resellers.
Administrative expenses have increased by 3.4% from GBP1.00m to
GBP1.03m as a result of increased variable costs (commissions and
bonuses) related to revenue growth.
The Group Balance Sheet shows total shareholders' equity as a
deficit of GBP0.34m (last year end GBP0.48m) funded principally by
working capital.
Trade receivables were lower at GBP0.40m (H1 2013 GBP0.47m) with
days sales outstanding, measured using the exhaustion method,
increasing from 42 days at 31 January to 47 days at 31 July.
The net cash flow generated by operating activities in the
period was GBP0.54m compared to GBP0.08m generated in the first
half last year. While the adjusted EBITDA (GBP0.18m) made a
significant contribution to this, the major reason for this cash
flow was working capital reduction (GBP0.36m) arising from
increases in deferred revenue (GBP0.15m), accruals of annual costs
(GBP0.11m) and a reduction in trade debtors (GBP0.1m).
Ian Smith
Finance Director
17 September 2013
CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME
(Unaudited)
FOR THE SIX MONTHS ENDED 31 JULY 2013
For the six months ended
July 31, July 31,
Continuing operations Notes 2013 2012
GBP'000 GBP'000
1
Revenue 2 1,364 1,280
Cost of sales (194) (247)
----------------- -----------------
Gross profit 1,170 1,033
Administration expenses (1,034) (999)
Profit from operations 136 34
Finance costs (3) (5)
Profit before income tax 2 133 29
Income tax credit - 7
----------------- -----------------
Profit for the period attributable
to equity holders of the parent
company 2 133 36
================= =================
Total Comprehensive Income attributable
to equity holders of the parent
company
133 36
================= =================
Earnings per share
Basic and diluted (pence per share) 3 0.028 0.008
CONSOLIDATED BALANCE SHEET AT 31 JULY 2013 (Unaudited)
July 31, January 31, July 31,
2013 2013 2012
GBP'000 GBP'000 GBP'000
Assets
Non-current assets
Intangible assets 103 122 148
Property, plant and
equipment 17 18 21
--------- ------------ ---------
120 140 169
--------- ------------ ---------
Current assets
Trade receivables 397 489 469
Other receivables 57 60 60
------------------------------ --------- ------------ ---------
Trade and other receivables 454 549 529
Cash and cash equivalents 1,288 791 641
--------- ------------ ---------
1,742 1,340 1,170
--------- ------------ ---------
Total assets 1,862 1,480 1,339
========= ============ =========
Liabilities
Current liabilities
Trade and other payables 2,121 1,865 2,008
Borrowings 30 30 25
Current taxation 30 30 30
--------- ------------ ---------
2,181 1,925 2,063
--------- ------------ ---------
Non-current liabilities
Borrowings 19 34 52
19 34 52
Total liabilities 2,200 1,959 2,115
--------- ------------ ---------
Total net liabilities (338) (479) (776)
========= ============ =========
Capital and reserves
attributable to equity
holders of the company
Share capital 4,738 4,738 4,738
Convertible loan notes 375 375 375
Share to be issued 29 29 29
Share premium 412 412 412
Merger reserve 361 361 361
Share option reserve 305 297 269
Reverse acquisition
reserve (20,570) (20,570) (20,570)
Retained earnings 13,949 13,816 13,547
Foreign currency translation
reserve 63 63 63
--------- ------------ ---------
Total deficit (338) (479) (776)
========= ============ =========
CONSOLIDATED CASH FLOW STATEMENT (Unaudited)
FOR THE SIX MONTHS ENDED 31 JULY 2013
For the six months
ended
July 31, July 31,
Notes 2013 2012
GBP'000 GBP'000
Net cash flows from operating activities 4 535 75
Taxation - 7
Investing activities
Purchases of property, plant and equipment (7) (4)
Expenditure on internally developed intangible
assets (13) (60)
Net cash used in investing activities (20) (64)
Financing activities
Borrowings (15) (13)
Interest paid (3) (5)
Net cash used in financing activities (18) (18)
---------- ---------
Net increase in cash and cash equivalents 497 -
Cash and cash equivalents at the beginning
of the period 791 641
---------- ---------
Cash and cash equivalents at the end of
the period 1,288 641
---------- ---------
ACCOUNTING POLICIES
1. Basis of preparation
The financial information in these interim results is that of
the holding company and all of its subsidiaries (the Group). It has
been prepared in accordance with the recognition and measurement
requirements of International Financial Reporting Standards as
adopted for use in the EU (IFRSs). The accounting policies applied
by the Group in this financial information are the same as those
applied by the Group in its financial statements for the year ended
31 January 2013, and which will form the basis of the 2013/14
financial statements.
There are no new published standards, or interpretations and
amendments to published standards, that are not yet effective, that
once effective would materially affect the Group.
The comparative financial information presented herein for the
year ended 31 January 2013 does not constitute full statutory
accounts for that period. The Group's Annual Report for the year
ended 31 January 2013 has been delivered to the Registrar of
Companies. The Group's Independent Auditors' report on those
accounts was unqualified and did not contain a statement under
section 498(2) or 498(3) of the Companies Act 2006. The financial
information for the half years ended 31 July 2013 and 31 July 2012
have neither been audited nor reviewed pursuant to guidance issued
by the Auditing Practices Board.
2. SEGMENT INFORMATION
The Group's services being, the design, sale and support of
computer software for the electronic management of information and
documents operate through a common infrastructure and support
function. Therefore the Directors believe the activities constitute
one operating segment through which it provides services.
The segment results are as follows:
For the six months
ended
July 31, July 31,
2013 2012
GBP'000 GBP'000
Revenue by service:
Sale of software licences and
related services 520 442
Sale of software maintenance contracts 844 838
---------- ---------
Revenue 1,364 1,280
Gross profit 1,170 1,033
Profit from operations 136 34
Profit before income tax 133 29
Profit for the period 133 36
Included in revenue above are GBP0.029m (H1 2013: GBP0.033m)
related to sales in Europe. All other revenue relates to the
UK.
All non-current assets and liabilities are held within the
UK.
The Group had one reseller who was responsible for 18% (H1 2013:
10%) of the Group's invoiced sales and a second reseller who was
responsible for 10% (H1 2013: 14%) of the Group's invoiced sales.
No other reseller was responsible for more than ten percent of the
Group's invoiced sales.
3. EARNINGS PER SHARE
For the six months
ended
July 31, July 31,
2013 2012
GBP'000 GBP'000
Profit for the period 133 36
============ ============
Basic earnings per share 0.028p 0.008p
------------ ------------
Diluted earnings per share 0.028p 0.008p
------------ ------------
Weighted average number of common
share outstanding 473,752,662 473,752,662
------------ ------------
Diluted weighted average number of
common share outstanding 473,752,662 473,752,662
------------ ------------
The weighted average number of common shares outstanding
includes ordinary shares of 0.001p and A ordinary shares of 0.001p.
The weighted average number of common shares outstanding does not
include the deferred shares arising from the share split approved
at the AGM on 25(th) June 2012 as these shares have very limited
rights and are considered worthless.
The diluted weighted average number of common shares outstanding
normally results from share options. The effect of the share
options has not been included in the calculation of the diluted
earnings per share because the share options are all out of the
money.
4. CASH GENERATED FROM OPERATIONS
For the six months
ended
July 31, July 31,
2013 2012
GBP'000 GBP'000
Profit for the period 133 36
Adjustments for:
Tax - (7)
Depreciation 8 7
Amortisation 32 49
Employee share scheme 8 23
Interest expense 3 5
Changes in working capital:
Trade and other receivables 95 105
Trade and other payables 256 (143)
---------- ---------
Net cash generated from operating
activities 535 75
========== =========
5. ADJUSTED EBITDA
For the six months
ended
July 31, July 31,
2013 2012
GBP'000 GBP'000
Profit for the period 133 36
Adjustments for:
Interest expense 3 5
Tax - (7)
Depreciation 8 7
Amortisation 32 49
Employee share scheme 8 23
184 113
========== =========
6. Copies of this interim statement will be available on the
Company's website, www.invu.net
This information is provided by RNS
The company news service from the London Stock Exchange
END
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