RNS Number:9040R
Dicom Group PLC
11 November 2003
DICOM Group plc
First Quarter Results 2003/2004 - Three Months to 30 September 2003
Good Results in Historically Slow Q1: Pre-tax Profits up 14%; Optimistic Full
Year Outlook
11 November 2003 - DICOM Group plc ("DICOM Group"), the global leader in the
Electronic Document Capture ("EDC") market, announces good results for the three
months to 30 September 2003.
Financial highlights of the First Quarter Results (UK GAAP):
* Turnover in EDC Division up 1% to #26.4m (2002: #26.1m), down 3% in local
currency terms
* EDC own products and services grew in local currency terms by 9% and 18%
respectively; now accounting for 60% (2002: 54%) of EDC sales
* Gross profit margins in EDC division up to 49% (2002: 45%)
* Increased operating profits in EDC Division, up 7% to #2.0m (2002: #1.9m)
* Group turnover down 8% to #33.6m (2002: #36.3m), excluding disposals
turnover up 1%
* Gross profit margins up from 37% to 42%
* Operating profits before goodwill amortisation up 8% to #2.2m (2002:
#2.1m)
* Profits before tax and goodwill amortisation up 14% to #2.3m (2002: #2.0m)
* Adjusted earnings per share up 10% to 8.0p (2002: 7.3p)
* Operating activities generated positive cash flow of #4.0m (2002: #1.2m)
Other highlights:
* Successful launch of Ascent Capture version 6.0 with new features to
compete more effectively at the high-end of the market
* First combined Ascent/Mohomine product launched for PeopleSoft's
Recruiting Solutions
* Ascent Capture voted favourite Document Capture application by Transform
Magazine
* SAP AG integration certification received for Ascent Release for ERP
* VRS Software integrated across entire Fujitsu enterprise scanner family
Commenting, Arnold von Buren, Chief Executive Officer of DICOM Group said:
"We continued to experience good levels of order intake in all areas of our EDC
Division, except for the distribution of complementary 3rd party products. The
quality of our EDC business is consistently improving, which is reflected by the
significant increase in gross profit margins. The new version of Ascent Capture
has been well received by our Customers. We continue to see growth in market
share particularly for our own EDC software products and related professional
services."
Regarding Prospects, Otto Schmid, Chairman of DICOM Group said:
"The Group is well positioned as global industry leader in the EDC market. We
continue to see improvements in the development of the EDC order pipeline in
contrast to the continuing difficult general trading conditions in the IT
market. We are excited by recent product launches, contract gains and
partnership agreements, which support our expansion into segments of the EDC
market not previously addressed. The US Dollar continues to be weak, reducing
the sterling value of our US operating profits. However, the EDC division's
current trading performance, particularly in our own products and services, and
good growth prospects enable the directors to view the Group's outlook for the
full year with optimism. "
About DICOM Group plc
DICOM Group plc ("DICOM Group") is the global leader in the Electronic Document
Capture ("EDC") market, a growth sector of the Office Automation industry. EDC
improves the performance of many business applications such as document and
content management and converts non-digital and digital documents into
structured data streams. Its implementation allows substantial increases in
office efficiency and offers high returns on investment.
DICOM Group's core competence is consulting, development and provision of EDC
products and services. Through authorised partners, DICOM Group has helped blue
chip enterprises in more than 60 countries to accomplish superior office
efficiency. DICOM Group supports its channels and customers with some 800 EDC
specialists, being directly present in 25 countries in Europe, the USA, South
East Asia and Australia.
The Ascent Capture platform captures scanned document images, text, forms, XML
data and Microsoft Office(R) documents. Web-based components and server products
enable organisations to capture information wherever it enters the organisation
- eliminating shipping costs and accelerating access to that information. Its
patented and award-winning VirtualReScanTM (VRS) product improves document image
quality and the scanning process in real time.
DICOM Group's European and Asian sales and service organisation offers a broad
range of services and complementary third party EDC products. Its network of
pre-sales, after-sales and consulting organisation addresses the increasing
demand for internationally deployed EDC solutions, project management and
professional support.
The Group's Samsung General Agency (SGA) Division focuses on multimedia
visualisation products for the IT, POI and Entertainment market in Switzerland.
It operates as sole agency of Samsung's high performance flat screen display.
For further information please contact:
DICOM Group plc Binns & Co Public Relations Ltd
Urs Niederberger COO and Finance Director Peter Binns
Dr. Bettina Moschner Investor Relations Manager Paul McManus
Tel: +44 (0) 800 6520 616 or
+49 (0) 761 45269 36
Fax: +44 (0) 1189 820 102 Tel : +44 (0) 20 7786 9600
+49 (0) 761 45269 936 Mob: +44 (0) 7980 541 893
E-mail: urs_niederberger@dicomgroup.com paul.mcmanus@binnspr.co.uk
bettina_moschner@dicomgroup.com
Internet: http://www.dicomgroup.com http://www.binnspr.com
DICOM Group plc
Interim Results Q1 2003/2004
Chairman's Statement
RESULTS
I am pleased to report good results for our historically slow first quarter to
30 September 2003. Group turnover was down 8% to #33.6m (2002: #36.3m). Adjusted
for last years disposal of the Austrian SGA business turnover grew by 1%.
Operating profits before goodwill amortisation were #2.2m (2002: #2.1m), up 8%.
Profit before tax and goodwill amortisation was #2.3m (2002: #2.0m), an increase
of 14%. After tax and minority interests basic earnings per share is calculated
at 4.2p (2002: 4.4p), down 5%. Adjusted earnings per share, earnings adjusted
for goodwill amortisation, was 8.0p (2002: 7.3p), up 10%.
These results, produced in our traditionally slow summer period, reinforce the
optimism expressed by the Board in the Chairman's Statement in our Annual Report
and Accounts, sent to shareholders on 23 September 2003.
The Group ended the period with net funds of #7.8m (#2.1m at 30 June 2003).
Operating cash flow amounted to #4.0m (2002: #1.2m) and the Group realised a net
#2.2m cash inflow from acquisitions and disposals.
OPERATING REVIEW
The Electronic Document Capture (EDC) Division is DICOM Group's largest
division, representing 90% (2002: 91%) of operating profits in the three months
to 30 September 2003. The EDC division develops application software and
electronic components, provides a comprehensive range of services and sells key
related products to over 1,000 system integrators and software houses in more
than 60 countries world-wide. EDC solutions offer users high returns on
investment by allowing document intensive organisations to reduce business
transaction costs and improve their level of customer service.
The EDC Division achieved sales growth of 1% in the quarter and contributed 79%
(2002: 72%) of the Group's turnover. The provision of services and sales of
products developed by the Group, primarily VirtualReScan, Ascent Capture and
Adrenaline, account for 60% (2002: 54%) of EDC turnover. Own product sales grew
by 9% in local currency terms and accounted for 37% of EDC sales. Service income
was up 18% in local currency terms, contributing 23% to EDC sales. Sales in 3rd
party EDC products decreased by 20% in local currency terms.
DICOM Group's European subsidiaries achieved good results despite the decrease
in 3rd party EDC product sales. Operating profit in the EDC Division increased
7% to #2.0m (2002: #1.9m), resulting in an EBITA margin of 7.6% (2002: 7.2%).
The Samsung General Agency (SGA) Division, the representative of Samsung
Electronics in Switzerland, continued to perform well with stable margins and
was able to contribute 10% (2002: 9%) to Group operating profits and 21% (2002:
28%) to Group turnover in the quarter.
PROSPECTS
The Group is well positioned as global industry leader in the EDC market. We
continue to see improvements in the development of the EDC order pipeline in
contrast to the continuing difficult general trading conditions in the IT
market. The Group's balance sheet is strong and the business continues to be
highly cash generative.
We are excited by recent product launches, contract gains and partnership
agreements, which support our expansion into segments of the EDC market not
previously addressed. We also look forward to further major planned product
launches scheduled for the second half of this financial year. The US Dollar
continues to be weak, reducing the sterling value of our US operating profits.
However, the EDC division's current trading performance, particularly in our own
products and services, and good growth prospects enable the directors to view
the Group's outlook for the full year with optimism.
Otto Schmid
Chairman
DICOM Group plc
Announcement of Unaudited Results
Consolidated Profit and Loss Account
3 months 3 months Year
to to to
30 September 30 September 30 June
2003 2002 2003
unaudited unaudited audited
Note #'000 #'000 #'000
Turnover 4 33,567 36,310 156,432
Cost of sales (19,504) (22,898) (97,386)
Gross profit 14,063 13,412 59,046
Operating expenses
Goodwill amortisation (778) (583) (2,869)
Other operating expenses (11,824) (11,339) (47,250)
Total operating expenses (12,602) (11,922) (50,119)
Operating profit before goodwill 4 2,239 2,073 11,796
amortisation
Goodwill amortisation (778) (583) (2,869)
Operating profit 1,461 1,490 8,927
Share of results of associated 13 (45) 41
undertakings
Net interest receivable/(payable) and
similar charges 43 (8) (167)
Profit on ordinary activities before 1,517 1,437 8,801
taxation
Taxation (689) (606) (3,407)
Profit on ordinary activities after 828 831 5,394
taxation
Minority interests 41 86 58
Profit attributable to ordinary 869 917 5,452
shareholders
Dividends - equity - - (1,001)
Retained profit 869 917 4,451
Earnings per ordinary share
- basic 2 4.2p 4.4p 26.2p
- adjusted 8.0p 7.3p 40.2p
- diluted 4.1p 4.4p 26.0p
Dividend per ordinary share - - 4.83p
Statement of total recognised gains and
losses
Profit for financial year 869 917 5,452
Gain/(loss) on currency translation 192 (884) (1,206)
Total recognised gains and losses
relating to the year 1,061 33 4,246
DICOM Group plc
Announcement of Unaudited Results
Consolidated Balance Sheet
At At At
30 September 30 September 30 June
2003 2002 2003
unaudited unaudited audited
Note #'000 #'000 #'000
Fixed assets
Intangible assets 43,040 37,176 43,785
Tangible assets 4,851 4,732 4,978
Investments 9,298 9,608 9,303
57,189 51,516 58,066
Current assets
Stocks 11,073 11,669 11,050
Debtors 30,415 31,294 34,409
Investments 111 247 110
Cash at bank and in hand 12,074 10,821 6,758
53,673 54,031 52,327
Creditors:
Amounts falling due within one year (37,155) (37,868) (37,448)
Net current assets 16,518 16,163 14,879
Total assets less current liabilities 73,707 67,679 72,945
Creditors:
Amounts falling due after more than one year (2,248) (2,110) (2,732)
Provisions for deferred taxation (678) (708) (699)
Net assets 70,781 64,861 69,514
Capital and reserves
Called up share capital 2,095 2,085 2,088
Share premium account 52,112 51,785 51,868
Merger reserve 1,717 527 1,717
ESOP shares (506) (492) (502)
Profit and loss account 15,392 11,119 14,331
Shareholders' funds - Equity 3 70,810 65,024 69,502
Minority interests - Equity (29) (163) 12
70,781 64,861 69,514
DICOM Group plc
Announcement of Unaudited Results
Consolidated Cash Flow Statement
3 months 3 months Year
to to to
30 September 30 September 30 June
2003 2002 2003
unaudited unaudited audited
Note #'000 #'000 #'000
Cash inflow from operating activities 5 3,955 1,151 15,453
Returns on investments and servicing of
finance 10 (9) (163)
Taxation paid (173) (525) (3,580)
Capital expenditure and financial (547) (778) (2,592)
investment
Acquisitions and disposals 2,219 (2,719) (9,116)
Equity dividends paid - - (910)
Cash inflow/(outflow) before use of liquid
resources and financing 5,464 (2,880) (908)
Management of liquid resources (3,359) (2,063) (849)
Financing
Issue of Ordinary Shares 251 31 147
(Decrease)/Increase in debt (783) 7,020 1,319
(532) 7,051 1,466
Increase/(Decrease) in cash in the period 1,573 2,108 (291)
Reconciliation of net cash flow to movement
in net funds
Increase/(Decrease) in cash in the year 1,573 2,108 (291)
Cash outflow/(inflow) from decrease/
(increase) in debt and lease financing 783 (7,020) (1,319)
Cash outflow from increase in liquid
resources 3,359 2,063 849
Change in net funds resulting from cash
flows 5,715 (2,849) (761)
Loans and finance leases acquired with
subsidiaries - - (113)
New finance leases (66) 5 (558)
Exchange difference (15) (88) (183)
Movements in net funds in the period 5,634 (2,932) (1,615)
Net funds at start of period 2,135 3,750 3,750
Net funds at end of period 7,769 818 2,135
DICOM Group plc
Interim Report Q1 2003/2004
Notes (UK GAAP)
1 Basis of preparation
The interim financial statement in accordance with UK GAAP has been prepared in
accordance with the accounting policies set out in, and is consistent with, the
Group's 2003 financial statement except that the taxation charge for the period
is based on the estimated charge for the year to 30 June 2004.
The interim financial information is unaudited and does not constitute statutory
accounts as defined in Section 240 of the Companies Act 1985. The abridged
information for the year to 30 June 2003 has been extracted from the Group's
statutory accounts for that period which have been filed with the Registrar of
Companies. The auditors' report on those accounts was unqualified and did not
contain a statement under Section 237(2) or (3) of the Companies Act 1985.
2 Earnings per share
The Earnings per share calculation is based upon Financial Reporting Standard
14. Basic Earnings per share 4.2p (4.4p) for the three months to 30 September
2003 has been calculated based on the profit attributable to shareholders of
#869,000 (#917,000) using the weighted average number of Ordinary Shares in
issue 20,905,044 (20,844,612) during the period.
Adjusted Earnings per share 8.0p (7.3p) for the three months to 30 September
2003 is based on profit of #1,662,000 (#1,515,000), being adjusted by the
amortisation of goodwill in subsidiaries of #778,000 (#583,000) and amortisation
of goodwill in associates of #15,000 (#15,000) using the weighted average number
of Ordinary Shares in issue 20,905,044 (20,844,612) during the period.
Diluted Earnings per share 4.1p (4.4p) for the three months to 30 September 2003
is based on 21,265,688 (20,999,377), the difference to the basic calculation
representing the additional shares that would be issued on the conversion of all
the dilutive potential Ordinary Shares. There is no material difference to
earnings if all the dilutive potential Ordinary Shares were converted.
3 Reconciliation of movements in shareholders' funds (UK GAAP)
3 months to 3 months to Year to
30 September 30 September 30 June
2003 2002 2003
#'000 #'000 #'000
Opening shareholders' funds before reclassification
of ESOP shares 70,004 65,458 65,458
Reclassification of ESOP shares (502) (492) (502)
Opening shareholders' funds 69,502 64,966 64,956
Reinstatement of goodwill previously charged
against reserves - - 1,190
Retained profit for the period 869 917 4,451
Currency exchange movements 192 (884) (1,206)
Changes in ESOP shares (4) - -
New share capital issued 251 25 111
Closing shareholders' funds 70,810 65,024 69,502
4 Segmental Reporting
3 months to 3 months to Year to
30 September 30 September 30 June
2003 2002 2003
#'000 #'000 #'000
Sales by divisions
EDC
Own products 9,822 9,331 38,006
Services 6,006 4,830 23,200
3rd party products 10,598 11,959 53,623
Total EDC 26,426 26,120 114,829
SGA 7,141 10,190 41,603
Group 33,567 36,310 156,432
Gross profit by divisions
EDC 12,838 11,791 52,735
SGA 1,225 1,621 6,311
Group 14,063 13,412 59,046
Operating profit before goodwill amortisation
by divisions
EDC 2,013 1,878 10,333
SGA 226 195 1,463
Group 2,239 2,073 11,796
5 Reconciliation of operating profit to operating cash flows
3 months to 3 months to Year to
30 September 30 September 30 June
2003 2002 2003
#'000 #'000 #'000
Operating profit 1,461 1,490 8,927
Depreciation and amortisation 1,300 1,158 5,034
Profit on sale of subsidiary undertaking - - (170)
Loss on sale of tangible fixed assets 3 - 2
(Increase)/decrease in stocks (23) (231) (107)
Decrease/(increase) in debtors 1,291 2,896 (555)
(Decrease)/increase in creditors (45) (4,051) 2,410
Foreign exchange differences (32) (111) (88)
Net cash inflow from operating activities 3,955 1,151 15,453
This information is provided by RNS
The company news service from the London Stock Exchange
END
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