TIDMACSO
RNS Number : 2197R
Accesso Technology Group PLC
20 September 2017
20 September 2017
accesso(R) Technology Group plc
("accesso" or the "Group")
INTERIM RESULTS
for the six-month period ended 30 June 2017
accesso Technology Group plc (AIM: ACSO), the premier technology
solutions provider to leisure, entertainment and cultural markets,
today announces interim results for the six months ended 30 June
2017. During the first half of the year the Group performed in line
with the Board's expectations, completed an important acquisition
and made significant progress in the ticketing side of the
business. The Group remains on track to achieve its aims in 2017,
although as ever, full year performance remains second half
weighted.
Financial Highlights
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2017 2016 % change 2016
---------------------------- ----------- ----------- ------------- -------------
$m $m $m
Revenue 46.6 39.7 17.4% 102.5
Adjusted EBITDA* 8.7 6.5 33.8% 19.1
Adjusted operating
profit** 6.5 5.0 30.0% 15.7
Profit before tax 1.6 2.3 (30.4%) 10.1
Adjusted cash generated
from operating activities
*** 1.7 2.1 (19.0%) 17.8
Net debt**** 23.8 12.5 3.4
Adjusted earnings
per share - basic
(cents) 22.25 15.80 40.8% 51.64
Earnings per share
- basic (cents) 4.96 7.36 (32.6%) 33.95
----------------------------- ----------- ----------- ------------- -------------
* EBITDA before the deduction of acquisition related expenses,
contingent payments accruing to vendors of Ingresso and share based
payments (note 4)
** Operating profit before the deduction of amortisation related
to acquisitions, acquisition expenses, contingent payments accruing
to vendors of Ingresso and share based payments (note 4)
*** Cash generated from operations before expenses related to
acquisition (note 4)
**** Cash and cash equivalents less borrowings
Operational Highlights
A solid start to 2017
o Strong Group performance and new customer wins across business
reflect strength of offering, success in offering multiple product
solutions and ability to access new verticals and increase
geographic reach
o Acquisitions of Ingresso and, post period end, of TE2, build
on our strategy of helping operators enhance and monetise the
customer journey, with the integration of both businesses
progressing to plan
accesso Passport(R)- Strong growth across geographies
o Several new wins in the period, including the NFL Experience
in Times Square, The CNN Studio Tour in Atlanta and The Jameson
Distillery in Ireland
o Post period-end contract signed with Australia's largest Theme
Park operator Village Roadshow Theme Parks, expanding existing
relationship in key growth region for the Group
o Total volumes up 18%
o Merlin rollout continuing as planned with go-lives in the half
including Merlin's London Cluster, Alton Towers, and the new
LEGOLAND(R) Japan Theme Park
o Geographic expansion continues with European volumes now 14.6%
of total (2016: 11.9%) and Asia Pacific at 2.79% (2016: 0.1%)
o Mobile eCommerce, where accesso operates a transaction based
fee model, continues to benefit from the shift away from front-gate
purchasing, increasing accesso's share of customer wallet
accesso Siriusware(sm) - Largest ever contract signed
o Landmark contract win with Experiencias Xcaret in Mexico
o Success reflects accesso Siriusware's broadening appeal in new
geographies and markets
o Significant win with Niagara Parks Commission for a combined
accesso Siriusware / accesso Passport solution
accesso LoQueue(sm -) Proving value on lower North American
attendance
o Challenging weather in the period in North America, combined
with strong comparators from 2016
o First deployment of accesso Prism(sm) facilitating the opening
of the world's first queueless park
o A major customer is commencing efforts to replace its entire
Qbot(sm) estate with accesso Prism
accesso ShoWare(sm) - Strong performance in Brazil and
Mexico
o Continued new business momentum with new venues secured in the
period located in US, Mexico, Columbia, Canada and Brazil
o Remains the focus of accesso's expansion into Mexico and
Central and South America, with volumes up 9.1% from 1H 2016
o New business momentum in Brazil with 1H 2017 ticket sales
exceeding the total for 2016
o Interface to Ingresso being developed with a September 2017
rollout date
Ingresso and TE2 - Enhancing value at each stage of the customer
journey
o Ingresso entertainment and travel activity customers realise
greater value from their ticketing operations by opening
third-party routes to market
o Ingresso volumes up 48.2% year-on-year for the period since
acquisition, with accesso ShoWare and accesso Passport customers
already migrating onto its platform
o Ingresso customers include Amazon Tickets, GroupOn and
YPlan
o TE2 post period end acquisition. TE2 offers
highly-personalised software solutions to improve guest experience
before, during and after a site-visit
o TE2 allows enterprise customers to understand, predict and
monetise consumer behaviour in the physical world
o TE2 customers include Carnival Cruise Line, Arby's and Groupo
Vidanta
o Both acquisitions are expected to grow substantially in 2017
with accelerating contributions thereafter
Commenting on the results Tom Burnet, Executive Chairman of
accesso, said:
"Accesso has started 2017 in a positive and determined way,
delivering two acquisitions guided by one central aim: our desire
to offer operators technology that drives revenue by improving
guest experiences.
The strength of the Group's overall performance during the
period is a validation of our efforts to diversify the business
across markets and geographies, while our products continue to
generate significant demand among prospective and existing
customers.
Although the first half of the year traditionally accounts for
less than 40% of annual revenue, the Board looks forward to the
remainder of the year with confidence."
Steve Brown, Chief Executive Officer, added:
"The start of 2017 has seen good progress across the entire
accesso business. Perhaps most pleasingly, we have seen Accesso
Prism, our state-of-the-art in-park wearable device, prove itself
in its market and demonstrate its versatility as a solution.
As we move forward, we'll continue with our work to integrate
Ingresso and TE2, ensuring we do everything we can to harness their
potential to enhance results for our clients."
***
This announcement contains inside information as defined in
Article 7 of the Market Abuse Regulation
For further information, please contact:
accesso Technology Group plc +44 (0)118 934 7400
Tom Burnet, Executive Chairman
Steve Brown, Chief Executive
Officer
John Alder, Chief Financial
Officer
FTI Consulting, LLP +44 (0)20 3727 1000
Matt Dixon, Adam Davidson
Canaccord Genuity Limited +44 (0)20 7523 8000
Simon Bridges, Martin Davison,
Richard Andrews
Numis Securities Limited +44 (0)20 7260 1000
Simon Willis, Mark Lander
About accesso Technology Group
accesso (AIM: ACSO) is the premier technology solutions provider
to leisure, entertainment and cultural markets. Our patented and
award-winning technology solutions drive increased revenue for
attraction operators while improving the guest experience.
Our solutions add value to operators at every point of the guest
experience with our technology facilitating the key points of
contact with their many millions of guests.
We drive attendance
The accesso Passport(R) and accesso ShoWare(SM) ticketing suites
are comprehensive, easy-to-use cloud solutions that process tens of
millions of tickets every year for assigned seat and general
admission venues, enabling operators to maximize up-sell and
cross-sell with ease to drive greater revenue.
We handle payments
Our payment gateway carries level 1 PCI security certification
and 24/7 support. It provides the tools, security and support
operators need to drive sales and has so far processed more than $6
billion in transactions.
We take guests out of line
Since 2001 more than 12 million guests have used a patented
accesso LoQueue(SM) solution to queue less, ride more, enjoy a
better experience and increase in-attraction spend.
We simplify point-of-sale
Our accesso Siriusware(SM) point-of-sale solution offers
software modules that combine ticketing, membership, retail,
food/beverage transactions, rentals, credit card processing and
many other functions into a single system eliminating the need for
separate systems and databases.
Attractions and venues worldwide currently employ accesso
technology - from theme parks, water parks, cultural attractions,
live performance venues and sporting events to ski and snow parks.
We are proud that the majority of the leading names in the leisure
industry including Six Flags Entertainment, Cedar Fair
Entertainment, Merlin Entertainments, Carnival Cruise Lines,
National Aquarium, Peak Resorts and Palace Entertainment, trust our
solutions.
accesso is a public company, listed on AIM: a market operated by
the London Stock Exchange. For more information visit:
www.accesso.com
***
Financial Review
The first half of 2017 has seen accesso's results benefit from
the breadth of its customer base, the diversity of its product-set
and its increasing geographic reach. Contributions from new regions
are increasing with each period, while customers continue to adopt
or combine accesso products in new markets.
accesso's revenue model
The Group generates a significant proportion of its business
from transaction-based or other repeatable contracts which together
with the long-term nature of key agreements provide high-quality
and highly visible revenue streams. This enables accesso to think
confidently about longer-term investment decisions, whether that be
related to product or M&A.
accesso's focus on transaction-based revenue is reflected in the
acquisitions of Ingresso and TE2, which both complement this
strategy. In addition to the visibility of future revenue, these
arrangements ensure that the final day of any agreement remains as
important to accesso as the first, creating a structure that
fosters an innovative partnership between accesso and our
customers.
Key financial metrics
The first half of 2017 has seen accesso build on strong 1H 2016
figures, delivering Group revenue of $46.6. Representing an
increase of 17.4% year on year from $39.7m in 1H 2016, this
performance reflects our increased global footprint, the broader
range of markets we now serve and the acquisition of Ingresso at
the end of March. This growth was delivered despite challenging
weather conditions impacting certain accesso LoQueue and accesso
Passport venues and considering a strong 1H 2016 trading period
previously reported. The impact of foreign exchange movements on
revenue, or costs, was not material.
The gross profit margin was 57.8% in 1H 2017, compared to 56.1%
in 1H 2016 which reflects a lower proportion of queuing revenue in
this period and a higher level of non-repeatable revenues than in
the comparative period.
Operating costs, excluding expenses relating to the Ingresso
acquisition, and share based payments, increased by 15.8% to $18.2m
(2016: $15.7m). As disclosed in note 3, an element of the
consideration payable in respect of the acquisition of Ingresso is
conditional on certain shareholders remaining in employment with
that business following the transaction. This results in this
element of the consideration not falling within the scope of IFRS3
"Business Combinations" and accordingly, an expense of $0.5m has
been charged in the current period. Additional charges will be made
until these payments become unconditional, which is expected to be
March 2018.
Adjusted EBITDA increased by 33.8% to $8.7m, at a margin of
18.7% (2016: 16.4%) resulting from the operational leverage within
the business. This increased margin also reflects the structuring
of certain accesso LoQueue agreements, with accesso recognising
revenue on a gross basis, results in profitability generally being
less sensitive to the impact of attendance changes than the revenue
line.
Adjusted operating profit, which the Board considers a key
underlying metric, increased by 30.0% to $6.5m (1H 2016:
$5.0m).
Finance costs in the period of $0.5m increased from $0.2m in
2016 due to increased borrowings to finance the Ingresso
acquisition and includes an amount of $0.2m relating to the costs
of the revised borrowing agreement.
Profit before tax decreased to $1.6m (1H 2016: $2.3m), after
transaction expenses relating to the Ingresso acquisition of $0.7m
and increased IFRS3 charges (amortisation on the acquired
intangibles and deferred consideration) totaling $1.0m. Adjusted
earnings per share in the first half of 2017 increased 40.8% to
22.25 cents (1H 2016: 15.80 cents).
Adjusted operating profit
The table below sets out a reconciliation between statutory
Operating profit and adjusted EBITDA and adjusted Operating
profit
Six months Six months
ended ended
30 June 2017 30 June 2016
Adjusted Adjusted
Adjusted Operating Adjusted Operating
EBITDA Profit EBITDA Profit
$000 $000 $000 $000
--------- ----------- --------- -----------
Operating profit 2,092 2,092 2,453 2,453
Add: Acquisition expenses 687 687 - -
Add: Deferred and contingent
payments accruing to
vendors of Ingresso 471 471 - -
Add: Total amortisation
and depreciation 4,885 - 3,629 -
Add: Amortisation related
to acquired intangibles - 2,706 - 2,117
Add: Share based payments 582 582 448 448
--------- ----------- --------- -----------
8,717 6,538 6,530 5,018
========= =========== ========= ===========
Cash and net debt
As with previous years, due to the traditional seasonality of
the business, the first half has not been significantly cash
generative. Cash generated from operations, ignoring acquisition
expenses, was $1.7m (1H 2016: $2.2m) with underlying cash
conversion unchanged from 2016. Capitalised development expenditure
was $4.8m in the period, down from $6.2m in 1H 2016, reflecting
reduced spending in relation to accesso Prism.
Financing costs included interest of $0.3m (1H2016: $0.2m) and
an arrangement fee of $0.4m relating to the extension of the
Group's borrowing facility.
The acquisition of Ingresso in March 2017 was funded via an
initial cash investment (net of cash acquired) of $16m.
Overall, net debt increased to $23.8m at the end of the period
from $3.4m at 31 December 2016.
To allow for sufficient headroom, the Group extended its
borrowing facility with Lloyds Bank plc. The extended Facility
provides the Group with the ability to draw down a total of $60m,
denominated in either US dollars, GB Pound Sterling or Euros, and
has a term of four years, with an option to extend by a further
twelve months at the end of the first year. The facility is at an
agreed rate of 140 basis points above LIBOR at a borrowing to
EBITDA ratio of less than 1.5 times, rising to 190 basis points if
the borrowing to EBITDA ratio is greater than 2.25 times. It
provides an additional accordion mechanism allowing for a further
$10m relating to future acquisitions, and includes a commitment
interest on undrawn funds of 35% of margin. The total available for
drawdown is subject to a reduction of US$10m on each of the first,
second and third anniversaries of the Extended Facility.
The Facility had an arrangement fee of $0.4m and is secured over
accesso's assets and intellectual property of the Group in the US
and UK.
The board believes that the Group remains in a strong financial
position at the period end.
Taxation
The Board expects the 2017 effective tax rate on adjusted profit
before tax to be approximately 20%, while the effective tax rate on
statutory profit before tax for the full year is expected to be
approximately 31.2% which are the rates used within 1H 2017 (1H
2016: 28%). The statutory effective tax rate will be significantly
higher to the adjusted rate due to the accounting treatment under
IFRS 3 whereby acquisition consideration payable to employees of an
acquired entity, who must remain employees post-acquisition as a
condition to receiving earn out or deferred consideration, is
treated as compensation expense rather than consideration.
The Group continues to review and implement opportunities for
maintaining or lowering its effective rate, while mindful of the
fact that the majority of taxable income will continue to be
generated in markets with significantly higher headline tax rates
than the UK.
Dividend
The Board maintains its view that the payment of a dividend is
unlikely in the short to medium term with cash better invested in
growth focused investment opportunities.
Operational Progress
accesso's objective is to offer technology which connects
visitors with venues, and to help those venues drive revenue from
the interactions they have with their guests. The results reported
here reflect the ongoing success of this strategy. From taking
guests out of line and enabling them to maximise the time they can
spend enjoying what a venue has to offer, to helping operators run
flexible and enticing eCommerce environments, accesso uses
technology to enhance guest journeys, before, during and after a
visit.
accesso Passport
accesso Passport continues to be a key element of the Group's
growth engine. As part of the ongoing rollout across Merlin
Entertainments' global estate, the first half of 2017 saw accesso
Passport go-live at venues including Merlin's London Cluster, Alton
Towers, and the new LEGOLAND(R) Japan Theme Park.
accesso Passport also continues to win business beyond the
Group's agreement with Merlin, landing four entirely new deals with
clients including the NFL Experience in Times Square, New York, The
CNN Studio Tour in Atlanta, Georgia and The Jameson Distillery in
Dublin, Ireland. After the period-end, an agreement was also
reached with Village Roadshow Theme Parks to install the accesso
Passport solution at key attractions in Australia. The contract
represents a significant expansion of an existing relationship,
following the installation of Qband(SM) , an accesso LoQueue
virtual queuing solution, at Village Roadshow's Wet'n'Wild Sydney
in 2016. It also demonstrates accesso's ongoing commitment to
expanding its reach across new markets and geographies. These wins
reflect the product's market-leading quality and impressive ability
to meet a range of challenges for customers of varying size, in
different markets and in a host of languages. Total accesso
Passport volumes increased 18% during the period. Development was
also undertaken to integrate the Ingresso platform into accesso
Passport allowing distribution of current accesso venues.
Through accesso Passport, the Group is progressing well in
establishing itself in greenfield geographies. For example,
European volumes now account for 14.6% of accesso Passport's total
(2016: 11.9%), while Asia Pacific now accounts for 2.79% (2016:
0.1%). This change in mix reflects a concerted effort to diversify
the Group's geographic footprint in order reduce overall dependency
on specific customers, weather conditions or market verticals. This
work is ongoing, but is progressing in a pleasing and meaningful
manner to date.
accesso Siriusware
The first half of 2017 saw accesso Siriusware win its largest
ever contract, agreeing a deal with the Mexican operator
Experiencias Xcaret. The operator has a network of seven popular
experiences, parks, and attractions in Mexico, and when
implementation is complete, accesso Siriusware will operate on more
than 400 workstations across them. As well as providing a range of
software modules including retail, food and beverage, access
control, rentals, reservations and gift cards, Experiencias Xcaret
will also use accesso Siriusware to coordinate and schedule
transportation between its various sites. This win represents the
latest important example of expansion for accesso Siriusware beyond
its traditional ski markets, showcasing its broad appeal and
ability to overcome universal guest-management challenges for
operators.
An important agreement was also signed with the Niagara Parks
Commission for the implementation of an integrated accesso
Siriusware/accesso Passport solution. accesso Siriusware will be
run on almost 100 salespoints on premises for ticket and pass
sales, access control, reservations and resource management.
accesso Passport will offer a fully integrated solution for on-line
sales. This implementation provides a further excellent example of
the market available for combining accesso solutions.
accesso ShoWare
accesso ShoWare continues its expansion in North and South
America, in particular with ticketing volumes in Brazil and Mexico
increasing 9.1% over the same period last year. Notable new
customers include SLS Casino and Resort in Las Vegas, Welk Resorts
in San Diego and Branson as well as Toluca FC in Mexico to name a
few.
accesso ShoWare will complete the real-time interface to
Ingresso by the Autumn of this year allowing all accesso ShoWare
customers to utilize the distribution platform of Ingresso. We
strongly believe that this interface has the potential to
completely transfer the traditional paper based, offline voucher
and allocation business to real-time electronic distribution
platforms allowing a specific ticket to be available at hundreds of
marketplaces at the same time.
In particular, our Brazilian business has outperformed
expectations with 1H ticket sales exceeding the full 2016 year.
Concerts by Bruno Mars, Ed Sheeran, John Mayer, Green Day and
events such as the Maximus Festivals all contributed to these
outstanding results.
We also secured the ticketing contract for another major league
soccer team in the city of Toluca, Mexico. Toluca FC recently
celebrated its 100-year anniversary and unveiled its completely
renovated stadium with a capacity of 31,000 for sports events and
up to 40,000 with concert seating.
accesso LoQueue
The first half of 2017 saw accesso LoQueue impacted by bad
weather at some of our key North American customers' sites which
impacted theme park attendance, albeit against a strong comparative
period. Despite these challenging conditions in North America,
accesso LoQueue continues to win new and varied business.
The most important development of the year so far has been the
deployment of accesso Prism, our state-of-the-art in-park wearable
device, enabling a leading operator to open the world's first
entirely queueless park. This park is redefining how guests spend
their day at an attraction and has created significant interest
from other operators globally. Elsewhere, another accesso LoQueue
operator has successfully concluded a first season of an
available-to-all / premium system hybrid. This proves the business
model of making virtual queuing optionally available to all whilst
preserving the premium model for those who wish to upgrade to a
higher level of service.
accesso Prism continues to make excellent strides and a current
leading client is about to start replacing their existing Qbot
estate with the new device. The device has also been modified to
enable it to operate within European markets.
Acquisitions
In March 2017, accesso completed the acquisition of Ingresso, a
leading Global Distribution System for entertainment ticketing.
Details of the transaction are included in note 6.
Ingresso operates a software platform which enables venue
operators, event producers and inventory aggregators to offer
real-time digital sales through global third party distribution
channels. Ingresso facilitates B2C sales of ticketed events though
a range of white-label partner eCommerce sites, and connects some
of the world's largest eCommerce companies to event ticketing
systems, allowing them to sell tickets to entertainment events
under their own brand and payment systems. It counts
Lastminute.com, Cirque du Soleil, Amazon tickets, GroupOn and Yplan
among its international partner base.
In July 2017, after the period end, accesso acquired The
Experience Engine ("TE2"), a developer of software solutions
primarily for the leisure, hospitality, entertainment and retail
sectors. Details of the transaction are included in note 6.
With market-leading personalisation and data orchestration
technologies, TE2 allows operators to capture, model and anticipate
guest behaviour and preferences not only pre and post-visit, but
also in the physical in-venue environment. This personalisation is
achieved using a number of heuristics, including
machine-learning-based recommendations, and is used to provide
actionable analytics and insight to customers' operations, retail
and marketing teams. While TE2's client base opens up a number of
new verticals to accesso products, it also shares several notable
customers with the pre-existing Group. Its existing client base in
new sectors includes Carnival Cruise Lines and Arby's, while shared
clients include Cedar Fair Entertainment and Merlin
Entertainments.
Combined, these acquisitions reflect the start of a new phase of
accesso's work to provide the best available guest experiences for
its customers. Both deals significantly expand the Group's
addressable market and ability to create value from guest journeys
in a holistic manner. The Group will continue to invest in its
leading-edge technology to enhance its platform and integrations of
the two companies are progressing well.
Current Trading & Outlook
The Group's performance during the first half has been strong,
primarily driven by continued momentum in accesso Passport and some
impressive wins across the remainder of the ticketing and guest
management business. Notwithstanding the lower than expected theme
park attendance experienced in the first six months, the Board
remains confident in the power of and demand for its products and
in its outlook for the full year.
-S -
Consolidated statement of comprehensive income
for the six month period ended 30 June 2017
Six months Six months
ended ended
30 June 30 June
2017 2016
$000 $000
-------------------------------------- ------------ ------------
Revenue 46,590 39,680
Cost of sales (19,670) (17,425)
------------ ------------
Gross profit 26,920 22,255
Administrative expenses (24,828) (19,802)
Operating profit 2,092 2,453
Finance expense (495) (201)
Finance income 16 2
------------ ------------
Profit before tax 1,613 2,254
Income tax charge (503) (631)
Profit for the period 1,110 1,623
============ ============
Other comprehensive
income
Items that will be reclassified
to the income statement
Exchanges differences on translating
foreign operations 353 (764)
------------ ------------
Other comprehensive income / (loss)
for the period, net of tax 353 (764)
------------ ------------
Total comprehensive income for
the period 1,463 869
============ ============
Profit / (loss) attributable
to:
Owners of the parent 1,110 1,633
Non-controlling interest - (10)
1,110 1,623
============ ============
Total comprehensive income / (loss)
attributable to:
Owners of the parent 1,463 869
Non-controlling interest - (10)
1,463 859
============ ============
Earnings per share expressed in
cents per share:
Basic 4.96 7.36
Diluted 4.68 7.05
All activities of the company are classified as continuing.
Consolidated statement of financial position
as at 30 June 2017
30 June 31 December
2017 2016
$000 $000
-------------------------------- -------- ------------
Assets
Non-current assets
Intangible assets 116,231 81,612
Property, plant and equipment 3,458 3,494
Deferred tax 6,945 6,008
------------
126,634 91,114
-------- ------------
Current assets
Inventories 653 491
Trade and other receivables 18,189 10,232
Tax receivable - 681
Cash and cash equivalents 12,836 5,866
------------
31,678 17,270
-------- ------------
Liabilities
Current liabilities
Trade and other payables 27,628 11,242
Finance lease liabilities 37 54
Corporation tax payable 680 -
------------
28,345 11,296
-------- ------------
Net current assets 3,333 5,974
-------- ------------
Non-current liabilities
Deferred tax 12,079 9,990
Finance lease liabilities - 9
Borrowings 36,662 9,298
------------
48,741 19,297
-------- ------------
Total liabilities 77,086 30,593
-------- ------------
Net assets 81,226 77,791
======== ============
Shareholders' equity
Called up share capital 359 357
Share premium 29,538 28,150
Own shares held in trust (1,163) (1,163)
Other reserves 9,824 9,242
Retained earnings 31,029 29,919
Merger reserve 14,540 14,540
Translation reserve (2,901) (3,254)
-------- ------------
Total shareholders' equity 81,226 77,791
======== ============
Consolidated statement of cash flows
for the six month period ended 30 June 2017
Six months Six months
ended ended
30 June 30 June
2017 2016
$000 $000
Cash flows from operations
Profit for the period 1,110 1,623
Adjustments for:
Amortisation on acquired intangibles 2,706 2,117
Amortisation on development costs 1,500 850
Depreciation and amortization on
other fixed assets 679 662
Share based payment 582 448
Finance expense 495 201
Finance income (16) (2)
Foreign exchange gain / (loss) 110 (834)
Income tax expense 503 631
------------ ------------
7,669 5,496
Increase in inventories (162) (109)
Increase in trade and other receivables (3,914) (2,847)
Decrease in trade and other payables (2,783) (401)
------------ ------------
Cash generated from operations 810 2,339
Tax received/ (paid) 188 (275)
------------ ------------
Net cash inflow from operating
activities 998 2,064
------------ ------------
Cash flows from investing activities
Investment in subsidiary, net of
cash acquired (16,034) -
Purchase of intangible fixed assets (4,845) (6,198)
Purchase of property, plant and
equipment (478) (746)
Interest received 16 2
------------ ------------
Net cash used in investing activities (21,341) (6,942)
------------ ------------
Cash flows from financing activities
Share Issue 1,390 956
Sale of shares held in trust - 1,240
Interest paid (279) (182)
Capitalised finance costs (350) -
Payments to finance lease creditors (27) (22)
Proceeds from borrowings 31,375 5,316
Repayment of borrowings (4,835) (1,000)
Net cash generated from financing
activities 27,274 6,308
------------ ------------
Increase in cash and cash equivalents
in the period 6,931 1,430
Cash and cash equivalents at beginning
of year 5,866 5,307
Exchange gain / (loss) on cash
and cash equivalents 39 (167)
------------ ------------
Cash and cash equivalents at end
of period 12,836 6,570
============ ============
Consolidated statement of changes in equity
for the six month period ended 30 June 2017
Share Share Retained Merger Other Own Translation Total Non-controlling Total
capital premium earnings reserve Reserves shares reserve attributable interest
held to equity
in holders
trust
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
---------------- --------- --------- --------- -------- ---------- -------- ------------ -------------- ----------------- -------
Balance
at 31
December
2016 357 28,150 29,919 14,540 9,242 (1,163) (3,254) 77,791 - 77,791
Comprehensive
Income
for the
year
Profit
for period - - 1,110 - - - - 1,110 - 1,110
Other
comprehensive
income - - - - - - 353 353 - 353
--------- --------- --------- -------- ---------- -------- ------------ -------------- ----------------- -------
Total
comprehensive
income
for the
year - - 1,110 - - - 353 1,463 - 1,463
--------- --------- --------- -------- ---------- -------- ------------ -------------- ----------------- -------
Contributions
by and
distributions
by owners
Issue
of share
capital 2 1,388 - - - - - 1,390 - 1,390
Share
based
payments - - - - 582 - - 582 - 582
--------- --------- --------- -------- ---------- -------- ------------ -------------- ----------------- -------
Total
contributions
by and
distributions
by owners 2 1,388 - - 582 - - 1,972 - 1,972
--------- --------- --------- -------- ---------- -------- ------------ -------------- ----------------- -------
Balance
at 30 June
2017 359 29,538 31,029 14,540 9,824 (1,163) (2,901) 81,226 - 81,226
========= ========= ========= ======== ========== ======== ============ ============== ================= =======
Balance
at 31
December
2015* 353 26,841 22,169 14,540 3,470 (2,136) (1,675) 63,562 2 63,564
Comprehensive
Income
for the
year
Profit
for period - - 1,633 - - - - 1,633 (10) 1,623
Other
comprehensive
income - - - - - - (764) (764) - (764)
Total
comprehensive
income
for the
year - - 1,633 - - - (764) 869 (10) 859
Contributions
by and
distributions
by owners
Issue
of share
capital 3 953 - - - - - 956 - 956
Share based
payments - - - - 448 - - 448 - 448
Reduction
of shares
held in
trust - - 222 - - 973 - 1,195 - 1,195
Total
contributions
by and
distributions
by owners 3 953 222 - 448 973 - 2,599 - 2,599
--------- --------- --------- -------- ---------- -------- ------------ -------------- ----------------- -------
Balance
at 30 June
2016* 356 27,794 24,024 14,540 3,918 (1,163) (2,439) 67,030 (8) 67,022
========= ========= ========= ======== ========== ======== ============ ============== ================= =======
*restated - see note 1
Notes to the Interim Statements
1. Basis of preparation
accesso Technology Group plc (the "Group") is a company
domiciled in England. The basis of preparation of this financial
information is consistent with the basis that will be adopted for
the full year accounts which will be prepared in accordance with
IFRS as adopted by the European Union.
While the financial figures included in this half-yearly report
have been computed in accordance with IFRS applicable to interim
periods, this half-yearly report does not contain sufficient
information to constitute an interim financial report as that term
is defined in IAS 34.
This interim financial information has neither been audited nor
reviewed pursuant to guidance issued by the FRC and the financial
information contained in this report does not constitute statutory
accounts within the meaning of Section 434 of the Companies Act
2006. The period to 31 December 2016 has been extracted from the
audited financial statements for that period.
Having considered the principal risks and uncertainties as
presented in the 31 December 2016 audited financial statements, and
those additional risks and uncertainties disclosed below, the
Directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable
future. Therefore, they continue to adopt the going concern basis
in preparing the half-yearly financial information.
Restatement of statement of changes in Group equity
The 30 June 2016 statement of changes in Group equity has been
amended to in relation to the adjustment made in the 31 December
2016 audited financial statements to remove the effects of the
translation of equity balances. Management identified that a number
of capital and reserve balances were being retranslated each year
for presentation purposes through the foreign currency translation
reserve, rather than at the historical exchange rate. As a result,
the statements of financial position and statements of changes in
equity for the periods ended 31 December 2015 and 30 June 2016 have
been restated to remove this foreign exchange movement. There has
been no change in total equity for the period. The effect of the
restatement is set out below:
Own
shares
Merger held Attributable
Share Share Retained relief Other in Translation to equity
capital premium earnings reserve reserves trust reserve holders
$000 $000 $000 $000 $000 $000 $000 $000
--------- --------- ---------- --------- ---------- -------- ------------ -------------
Balance
at 31 December
2015 (as
previously
reported) 326 24,313 21,033 13,810 3,427 (1,971) 2,624 63,562
Restatement 27 2,528 1,136 730 43 (165) (4,299) -
--------- --------- ---------- --------- ---------- -------- ------------ -------------
Balance
at 31 December
2015 (restated) 353 26,841 22,169 14,540 3,470 (2,136) (1,675) 63,562
--------- --------- ---------- --------- ---------- -------- ------------ -------------
Own
shares
Merger held Attributable
Share Share Retained relief Other in Translation to equity
capital premium earnings reserve reserves trust reserve holders
$000 $000 $000 $000 $000 $000 $000 $000
--------- --------- ---------- --------- ---------- -------- ------------ -------------
Balance
at 30 June
2016 (as
previously
reported) 299 22,959 21,593 12,499 3,639 (892) 6,933 67,030
Restatement 57 4,835 2,431 2,041 279 (271) (9,372) -
--------- --------- ---------- --------- ---------- -------- ------------ -------------
Balance
at 30 June
2016 (restated) 356 27,794 24,024 14,540 3,918 (1,163) (2,439) 67,030
--------- --------- ---------- --------- ---------- -------- ------------ -------------
2. Accounting policies
The condensed consolidated interim financial information has
been prepared using accounting policies consistent with those set
out on pages 29 to 38 in the audited financial statements for the
period ended 31 December 2016. These accounting policies have been
applied consistently to all periods presented in this financial
information.
3. Taxation
The tax expense for each period has been calculated on the
expected annual effective rate. The adjusted earnings per share
(note 5) for the six months ended 30 June 2017 has been presented
using an estimated adjusted rate for the period, which has been
adjusted to remove the effect of earn out and deferred
consideration expected in relation to the acquisitions of Ingresso
and TE2. Under IFRS 3, consideration paid to employees of the
acquired entity, who must remain employees post-acquisition in
order to receive earn out or deferred consideration, is treated as
compensation expense rather than consideration for book purposes.
For tax purposes, these amounts are considered part of the earn out
or deferred consideration, which is not deductible for tax
purposes.
4. Reconciliation of alternative performance measures
Six months Six months
ended ended Year ended
30 June 31 December
2017 30 June 2016 2016
Adjusted Adjusted Adjusted
Adjusted Operating Adjusted Operating Adjusted Operating
EBITDA Profit EBITDA Profit EBITDA Profit
$000 $000 $000 $000 $000 $000
--------- ----------- --------- ----------- --------- -----------
Operating profit 2,092 2,092 2,453 2,453 10,512 10,512
Add: Acquisition
expenses 687 687 - - - -
Add: Deferred
acquisition
consideration
(i) 471 471 - - - -
Add: Total amortisation
and depreciation 4,885 - 3,629 - 6,221 -
Add: Amortisation
related to acquired
intangibles - 2,706 - 2,117 - 4,227
Add: Share based
payments 582 582 448 448 987 987
--------- ----------- --------- ----------- --------- -----------
8,717 6,538 6,530 5,018 19,113 15,726
========= =========== ========= =========== ========= ===========
(i) Per IFRS 3, consideration paid to employees of the acquired
entity, who must remain employees post-acquisition in order to
receive earn out or deferred consideration, is treated as
compensation expense rather than consideration.
Adjusted cash from operations
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2017 2016 2016
$000 $000 $000
------------ ----------- -------------
Cash flow from operating
activities 998 2,064 17,822
Add: Acquisition related
expenses 687 - -
1,685 2,064 17,822
============ =========== =============
Net debt
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2017 2016 2016
$000 $000 $000
------------ ----------- -------------
Borrowings 36,662 19,036 9,298
Less: Cash (12,836) (6,570) (5,866)
23,826 12,466 3,432
============ =========== =============
5. Earnings per share ("EPS")
The calculation of the basic earnings per share is based on the
earnings attributable to ordinary shareholders divided by the
weighted average number of shares in issue during the period.
Diluted earnings per share is calculated by dividing the profit
attributable to ordinary shareholders by the weighted average of
ordinary shares outstanding during the period adjusted for the
effects of dilutive instruments.
Adjusted basic earnings per share is calculated by dividing the
profit attributable to ordinary shareholders adjusted for costs
related to acquisition expenses, the amortisation on acquired
intangibles, share based compensation, and amortisation of loan
refinancing charges, net of tax effects, by the weighted average
number of shares used in basic EPS. The denominator for adjusted
diluted earnings per share is the weighted average number of shares
used in diluted EPS.
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2017 2016 2016
$000 $000 $000
-------------------------------- ---------- ---------- ------------
Profit attributable to ordinary
shareholders 1,110 1,623 7,526
Basic EPS
Denominator
Weighted average number of
shares used in basic EPS 22,375 22,040 22,169
---------- ---------- ------------
Basic earnings per share
- cents 4.96 7.36 33.95
========== ========== ============
Diluted EPS
Denominator
Weighted average number of
shares used in basic EPS 22,375 22,040 22,169
Effect of dilutive securities
Options 1,333 967 1,332
---------- ------------
Weighted average number of
shares used in diluted EPS 23,708 23,007 23,501
Diluted earnings per share
- cents 4.68 7.05 32.02
========== ========== ============
Adjusted EPS
Profit before tax 1,613 2,254 10,102
Adjustments to profit for
the period:
Acquisition expenses 687 - -
Amortisation relating to
acquired intangibles from
acquisitions 2,706 2,117 4,227
Earn out compensation 471 - -
Shared based compensation 582 448 987
Amortisation of capitalised
finance costs 163 18 49
---------- ---------- ------------
Adjusted profit before tax 6,222 4,837 15,365
Tax at the adjusted effective
rate: (2017: 20%; H1 2016:
28%; FY 2016: 25.5%) (1,244) (1,354) (3,918)
---------- ---------- ------------
Adjusted profit attributable
to ordinary shareholders 4,978 3,483 11,447
Adjusted basic EPS
Denominator
Weighted average number of
shares used in basic EPS 22,375 22,040 22,169
Adjusted earnings per share
- cents 22.25 15.80 51.64
========== ========== ============
Adjusted diluted EPS
Denominator
Weighted average number of
shares used in diluted EPS 23,708 23,007 23,501
Adjusted earnings per share
- cents 21.00 15.14 48.71
========== ========== ============
6. Acquisition of Ingresso Group Limited ("Ingresso")
On 30 March 2017, the Group acquired 100% of the voting equity
of Ingresso Group Limited, a provider of live access to ticketed
events worldwide across multiple platforms, languages and
currencies.
accesso acquired Ingresso for an initial cash consideration of
$21.8m, plus a potential earn out payment.
The earn out may be payable in 2018 based on the financial
performance of Ingresso for the year ended 31 December 2017
exceeding its financial performance in 2016. The earn out payment,
capped at GBP10.5m ($13.1m), is payable in cash and is secured by a
floating charge on the assets of Ingresso. The Group's statement of
financial position includes a liability in relation to the earn out
of $9.6m.
The total aggregate consideration excluding the working capital
adjustment, is capped at GBP28.0m ($35.0m), assuming that the earn
out is achieved in full.
Acquisition related costs of $0.7m were incurred in relation to
this acquisition, excluding capitalised finance costs ($0.4m), and
are included within administrative expenses within the statement of
comprehensive income for the period. Finance costs are amortised
over the life of the agreement.
Details of the provisional fair value of identifiable assets and
liabilities acquired, purchase consideration, and goodwill are
below as of the acquisition date:
Provisional Provisional
Book Provisional fair
value Adjustment value
$000 $000 $000
------------ ------------ ------------
Identifiable intangible
assets
Internally developed technology 514 10,349 10,863
Customer relationships - 1,481 1,481
Trademarks - 1,349 1,349
Supplier contracts - 930 930
Property, plant and equipment 49 - 49
Receivables and other debtors 4,043 - 4,043
Payables and other liabilities (9,246) - (9,246)
Cash 5,743 - 5,743
Deferred tax asset 863 - 863
Deferred tax Liability - (2,545) (2,545)
------------ ------------ ------------
Total net assets 1,966 11,564 13,530
------------ ------------ ------------
Cash paid at completion 21,777 - 21,777
Contingent consideration,
at present value 9,553 - 9,553
Total consideration 31,330 - 31,330
------------ ------------ ------------
Goodwill on acquisition 17,800
============
The main factors leading to the recognition of goodwill are the
presence of certain intangible assets, such as the assembled
workforce of the acquired entity and the expected synergies of the
enlarged group which do not qualify for separate recognition.
The net cash outflow in the period related to the acquisition
comprised:
Fair value
$000
-----------
Cash paid on completion (21,777)
Cash acquired 5,743
16,034
===========
7. Acquisition of Blazer and Flip Flops, Inc. DBA The Experience
Engine ("TE2")
On 21 July 2017, the Group acquired 100% of the voting equity of
Blazer and Flip Flops, Inc, a privately-owned developer of software
solutions which enables leading enterprises to offer a
highly-personalised guest experience to their customers, primarily
in the leisure, hospitality, entertainment and retail sectors. The
acquisition was for an enterprise value of GBP62.3 million ($80
million), and was funded by the issue of $14.4 million in accesso
shares to the Vendors and an underwritten vendor and cash placing
of GBP58.8 million ($75.6 million).
8. Dividend
No dividend has been proposed or recommended during the period.
The Board maintains the view that the payment of a dividend is
unlikely in the short to medium term with cash better invested on
growth-focused investment opportunities.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SFWFAUFWSESU
(END) Dow Jones Newswires
September 20, 2017 02:00 ET (06:00 GMT)
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