RNS Number:4679P
Belgravium Technologies PLC
06 March 2008
For Immediate Release 6 March 2008
Belgravium Technologies Plc
(BVM:AIM)
Preliminary Results for the year ended 31 December 2007
The Board of Belgravium Technologies plc ("Belgravium" or "the Group"),
designers and manufacturers of real time mobile computing systems, is pleased to
announce Preliminary results for the year ended 31 December 2007.
FINANCIAL HIGHLIGHTS
* Turnover �10,637,000 (2006: �10,922,000) -2.9%
* Profit before tax �2,053,000 (2006: �1,844,000) +11%
* Final Dividend 0.38p (2006: 0.36p) +5.5%
* Earnings per Share 1.41p (2006: 1.27p) +11%
OPERATIONAL HIGHLIGHTS
*Profit growth demonstrates Belgravium's world leading status in mobile
computing systems for logistics and retail markets
*Development of International sales pipeline
*Commercial emphasis on software sales: significant sales opportunities
achieved
*Further synergies through rationalised operations creating margin
improvement
Commenting today, Executive Chairman John Kembery said:
"I am pleased to report a good year in 2007. The Group has strengthened its
position in specialised market sectors whilst simultaneously increasing profits.
This is a great achievement against a backdrop of heightening global economic
uncertainty.
The businesses of Touchstar and Novo have once again made valuable contributions
to the Group's improved profits and earnings per share in 2007, with year on
year growth in EPS at 14%, the second consistent year of double digit growth.
These results demonstrate the inherent strengths within our market leading
business and we look forward to the opportunities in the year ahead."
For further information please contact:
Belgravium Technologies plc 07770 731021
John Kembery, Chairman
Buchanan Communications 020 7466 5000
Suzanne Brocks
www.belgravium-IR.com
CHAIRMAN'S STATEMENT
Results
I am pleased to report a successful year for Belgravium in 2007.
We have achieved a profit before tax of �2,053,000, an increase of 11% on the
2006 figure of �1,844,000, on turnover of �10,637,000 (2006: �10,922,000) as
synergistic efficiencies from the acquisitions of Novo IVC and Touchstar were
realised.
Earnings per ordinary share also grew by 11% to 1.41p per share, (2006: 1.27p
per share), the second consecutive year of double digit growth, following the
31% uplift reported in 2006.
Operational Review
2007 was a year in which Belgravium succeeded in improving profits whilst
consolidating its position as a world leader in certain specialised mobile
computer markets.
When Touchstar was acquired at the end of 2005, it was recognised that the
Company had a unique combination of skills and products to supply the
international petrochemical distribution market. Further, this market offered
plenty of scope for development and growth. The petrochemical market is
worldwide and customer service is vital. Accordingly, sales are best served
through a combination of business partners and agents. Whilst Touchstar services
smaller contracts closer to home, the larger projects have required the building
of an overseas network. Development of Touchstar's international sales is a
continuous process and much has been achieved in 2007 which will bring benefits
in the future.
The other major attraction of the Touchstar acquisition was the opportunity to
rationalise technical and production operations. This brings greater efficiency
and cost benefits from more co-ordinated activity and less reliance on
outsourcing. This process has continued with great success during 2007.
At the same time, we have focussed commercial emphasis on the sale of software
and support services.
The resulting costs and operating margin improvements have enabled the Group to
increase profits at the same time as developing our international sales
pipeline.
Novo IVC, acquired in early 2006, was quickly integrated as a sales division of
Touchstar. As market leader in developing software for mobile retail systems,
for example, aircraft and trains, Novo already had a strong forward sales
position. In 2007 we were able to build on that position, gaining some good
contracts from this sector.
Belgravium Limited supplies real time data capture systems to the warehousing
and logistics market, largely within the British Isles. From a technical and
operational viewpoint, activities have been substantially integrated with
Touchstar, again with significant cost savings. Sales, in this sector tend to be
more specialised, but we are pleased to report that, in 2007, we have been
highly successful in gaining solid progress in this more mature market. Once
again, we have concentrated on the highest quality of products and services and
on providing a comprehensive and conclusive solution to customer needs.
In summary, across all three divisions, 2007 has been a good year, in which
Belgravium has strengthened its position in its specialised market sectors
whilst materially increasing profits.
Product Development
We have now integrated our product development capabilities across the entire
Group, focussed through two main activities:
1. Solutions to short term operational customer queries for
existing hardware and software
2. Development of new products, refining both hardware and
software designs to address ever-changing consumer demand. Smaller, lighter
hardware and software extending the existing scope of activities is in constant
demand.
In 2007 we have made advances in both these areas, bringing improved products to
all divisions, in addition to an entirely new design concept which will launch
in 2008. We recognise the consistent level of work required to ensure our range
of software is world class.
It remains management's objective to produce steady growth in profits and
dividends, optimising the return to shareholders. Our products must address many
demands in what can be challenging industrial and retail applications, meeting
stringent approvals in each of the sectors we serve. Our aim is to produce total
solutions for our client base, providing not just hardware and software but also
the associated maintenance and support. This provides a greater degree of
recurring income and therefore visibility in our earnings stream.
Balance Sheet
Belgravium's balance sheet has consistently shown a steadily strengthening
position. Net debt reduced from �2,589,000 in 2006 to �1,962,000 in 2007. It is
usual for Belgravium's sales to be weighted towards the final quarter of the
financial year although in 2007 this was particularly pronounced. As a result,
trade debtors as at 31 December were higher than usual, a position that has
started to reverse post year end. The Group remains cash generative despite
retiring the bank loan partially used to purchase Touchstar at a rate of �1
million per year.
Dividend
Consistent with our policy of paying the highest dividend that the Company can
afford and what we deem the most effective use of funds for Shareholders, the
Board is pleased to recommend an increased final dividend of 0.38p per ordinary
share (2006: 0.36p). This will be paid on 11 June 2008, subject to approval at
the AGM, to shareholders on the register on 9 May 2008.
Employees
When the acquisitions were made we said that we were delighted both by the
quality of the staff concerned but also by their willingness to co-operate in
the difficult task of integrating the companies. This continues to be the case
and the integration of the Group has been a tribute to co-operation by both
staff and management.
Outlook
2007 has been a year in which Belgravium Group has made progress both through
our sales network and a widening of our technical capability. We have again
delivered an improvement in profit as some of the benefits we foresaw at the
time of the Novo IVC and Touchstar acquisitions have been realised. Looking
ahead, there are some attractive projects in the pipeline and we look forward to
delivering organic growth in 2008 and beyond.
J P Kembery
Executive Chairman
5 March 2008
Audited consolidated income statement
Year ended
31 December
2007 2006
�'000 �'000
------------------ ------ --------- --------- --------- ---------
Revenue 10,637 10,922
Cost of sales 4,407 4,552
------------------ ------ --------- --------- --------- ---------
Gross profit 6,230 6,370
Distribution costs (98) (112)
Administrative expenses (3,931) (4,265)
------------------ ------ --------- --------- --------- ---------
Operating profit 2,201 1,993
Finance income 28 32
Finance expense (176) (181)
------------------ ------ --------- --------- --------- ---------
Profit before tax 2,053 1,844
Taxation (634) (569)
------------------ ------ --------- --------- --------- ---------
Profit for the year attributable to equity
shareholders 1,419 1,275
----------------------------- --------- --------- ---------
Earnings per share for profit attributable to
equity shareholders
Basic 1.41p 1.27p
----------------------------- --------- --------- ---------
Diluted 1.41p 1.26p
----------------------------- --------- --------- ---------
Consolidated statement of changes in equity for the year ended 31 December 2007
Capital
Called up Share redemption Retained
share capital premium reserve earnings Total
�'000 �'000 �'000 �'000 �'000
---------------- -------- -------- -------- -------- --------
Balance at 1
January 2006 5,021 2,915 2,100 (2,630) 7,406
Profit for the
year - - - 1,275 1,275
Dividends
(note 13) - - - (452) (452)
---------------- -------- -------- -------- -------- --------
Balance at 31
December 2006 5,021 2,915 2,100 (1,807) 8,229
New shares
issued 26 17 - - 43
Profit for the
year - - - 1,419 1,419
Dividends
(note 13) - - - (504) (504)
---------------- -------- -------- -------- -------- --------
Balance at 31
December 2007 5,047 2,932 2,100 (892) 9,187
---------------- -------- -------- -------- -------- --------
Audited consolidated balance sheet as at 31 December 2007
2007 2006
�'000 �'000
-------------------------- ----------- -----------
Non-current assets
Intangible assets
-------------------------- ----------- -----------
Goodwill 9,124 9,124
Other intangible assets 267 201
-------------------------- ----------- -----------
Property, plant and equipment 251 361
Deferred income tax assets 7 27
-------------------------- ----------- -----------
9,649 9,713
-------------------------- ----------- -----------
Current assets
Inventories 1,262 1,157
Trade and other receivables 3,901 3,298
Cash and cash equivalents 2 171
-------------------------- ----------- -----------
5,165 4,626
-------------------------- ----------- -----------
Current liabilities
Trade and other payables 3,145 2,975
Current income tax liabilities 472 324
Financial liabilities: Borrowings 1,214 1,005
Short term provisions 46 51
-------------------------- ----------- -----------
4,877 4,355
-------------------------- ----------- -----------
Net current assets 288 271
-------------------------- ----------- -----------
Non-current liabilities
Financial liabilities:
Borrowings 750 1,755
-------------------------- ----------- -----------
Net assets 9,187 8,229
-------------------------- ----------- -----------
Capital and reserves
Ordinary shares 5,047 5,021
Share premium 2,932 2,915
Capital redemption reserve 2,100 2,100
Profit and loss account (892) (1,807)
-------------------------- ----------- -----------
Equity shareholders' funds 9,187 8,229
-------------------------- ----------- -----------
Audited consolidated cash flow statement for the year ended 31 December 2007
2007 2006
�'000 �'000
------------------------------- --------- ---------
Cash flows from operating activities
Operating profit 2,201 1,993
Depreciation 179 199
Amortisation 80 56
Loss on sale of tangible fixed assets 2 -
Movement in:
Provisions (5) (122)
Inventories (105) 91
Trade and other receivables (603) (576)
Trade and other payables 172 118
------------------------------- --------- ---------
Cash generated from operations 1,921 1,759
Interest received 28 37
Interest paid (178) (183)
Corporation tax paid (466) (1,382)
Corporation tax received - 180
------------------------------- --------- ---------
Net cash generated from operating activities 1,305 411
------------------------------- --------- ---------
Cash flows from investing activities
Acquisition of subsidiary undertakings (net of cash
acquired) - (700)
Acquisition expenses - (356)
Expenditure on intangible assets (146) (108)
Purchase of property, plant and equipment (71) (169)
------------------------------- --------- ---------
Net cash used in investing activities (217) (1,333)
------------------------------- --------- ---------
Cash flows from financing activities
Proceeds from issuance of ordinary shares 43 -
Proceeds from bank borrowings - 2,580
Repayment of bank borrowings (1,000) (250)
Repayment of loan notes - (2,580)
Dividends paid to company's ordinary shareholders (504) (452)
Repayment of capital on finance leases (10) (4)
------------------------------- --------- ---------
Net cash used in financing activities (1,471) (706)
------------------------------- --------- ---------
Net decrease in cash, cash equivalents and bank overdrafts (383) (1,628)
Cash, cash equivalents and bank overdrafts at start of the
year 171 1,799
------------------------------- --------- ---------
Cash, cash equivalents and bank overdrafts at end of the
year (212) 171
------------------------------- --------- ---------
Audited reconciliation of net financial liabilities
2007 2006
�'000 �'000
------------------------------- ---------- ----------
Reconciliation of net financial liabilities
Net decrease in cash, cash equivalents and bank (383) (1,628)
overdrafts
Net change in bank loans and finance leases 1,010 254
Non-cash changes:
New finance leases and hire purchase agreements - (14)
------------------------------- ---------- ----------
Movement in net financial liabilities in the year 627 (1,388)
Net financial liabilities at beginning of year (2,589) (1,201)
------------------------------- ---------- ----------
Net financial liabilities at end of year (1,962) (2,589)
------------------------------- ---------- ----------
Audited earnings per ordinary share
2007 2006
----------------------------------- ---------- ----------
Basic earnings per ordinary share 1.41p 1.27p
Diluted earnings per ordinary share 1.41p 1.26p
----------------------------------- ---------- ----------
Basic earnings per share is calculated by dividing the earnings attributable to
ordinary shareholders by the weighted average number of ordinary shares in issue
during the year.
For diluted earnings per share, the weighted average number of ordinary shares
in issue is adjusted to assume conversion of all dilutive ordinary shares. The
dilutive ordinary shares represent the share options and warrants granted to
employees where the exercise price is less than the average market price of the
Company's ordinary shares during the year.
Reconciliations of the earnings and weighted average number of shares used in
the calculation are set out below:
2007 2006
Weighted
average Weighted
number average
of shares number
Earnings (in Earnings of shares (in
�'000 thousands) �'000 thousands)
----------------------- --------- --------- --------- ---------
Basic EPS
Earnings
attributable
to ordinary
shareholders 1,419 100,665 1,275 100,426
Effect of dilutive
securities
Options - 166 - 500
----------------------- --------- --------- --------- ---------
Diluted EPS
Adjusted
earnings 1,419 100,831 1,275 100,926
----------------------- --------- --------- --------- ---------
Basis of Reporting
This preliminary announcement has been prepared in accordance with International
Financial Reporting Standards ("IFRS") and IFRIC interpretations as adopted by
the EU and with those parts of the Companies Act 1985 applicable to companies
reporting under IFRS. The preliminary announcement does not constitute statutory
accounts within the meaning of Section 240 of the Companies Act 1985. This
announcement has been agreed with the company's auditors for release.
This preliminary announcement contains information extracted from the audited
financial statements of the group for the year ended 31 December 2007. The
statutory accounts for the year ended 31 December 2007 will be sent to the
shareholders shortly.
The information for the year ended 31 December 2006 has been amended for the
adoption of IFRS. The statutory accounts for the year ended 31 December 2006,
which have been delivered to the Registrar of Companies, included an audited
report which was unqualified and which did not contain a statement under Section
237(2) or (3) of the Companies Act 1985.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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