RNS Number : 6235E
IMS Maxims PLC
30 September 2008
IMS Maxims ("the Company" or "IMS")
Final Results for the Year Ended 31 March 2008
Chairman's Statement
We have continued to invest in the expansion of our applications portfolio and in the enhancement of our underlying architecture and
technology. IMS MAXIMS can now offer an immediate means of delivering to UK National Health Service ("NHS") Trusts the key, priority
applications described in the recent NHS Informatics Review as "The Clinical 5". As we pointed out last year, the situation in our major
market of the NHS has continued to evolve. The Connecting for Health ("CfH") programme is now openly experiencing difficulty in meeting its
timetable for rolling out solutions to these needs. The NHS is demanding more flexibility in the delivery of the services to Trusts. This is
evidenced by the recent cancellation of a contract for the South Region held by Fujitsu, the Local Service Provider ("LSP"). Despite the
fact that IMS applications can meet the needs of Trusts now, the complex contractual arrangements between CfH and its LSPs make it extremely
difficult for us to make progress in this area.
CfH have now put in place supplier framework agreements - known as the Additional Supply Capability and Capacity ("ASCC") - offering a
wide range of IT goods and services, including clinical applications, at national, regional and local levels. We are listed as a
sub-supplier to 6 named suppliers. Furthermore, our wholly owned subsidiary, 3C Healthcare Partnership Limited ("3C"), has been appointed as
a supplier in its own right. This latter appointment not only creates a further channel for us to offer our own products to the NHS, but
also allows us the possibility to work with proven partner companies in the NHS in offering a broader range of non-competitive products.
However, it is not clear just how much business will be done through the ASCC agreements, and we are disappointed that there has not yet
been any meaningful level of enquiry via this channel from potential purchasers. The Irish Health Services Executive is under intense public
and political scrutiny and a major restructuring of the organisation is in progress. In these circumstances we do not anticipate that there will be any serious level of new business from this sector in
the near future. In view of the above, we have turned our focus towards the private healthcare provider sector. Early signs are very
encouraging and we have signed framework contracts with GHG, the biggest private supplier to the UK healthcare sector, and with Care (UK)
Limited, the fourth largest. Discussions with remaining private suppliers are proceeding positively. We see this as an important shift in
direction for IMS, from which we expect to generate further revenue in 2009.
In other noteworthy events, we successfully completed delivery of our contracted requirements via British Telecom to Barking, Havering
and Redbridge NHS Trust during the year, which has had a positive effect on the second half of the year. Also, in March we announced the
acquisition of Preview Health Limited, a small provider of specialist information systems. This transaction has been structured to allow IMS
to earn a future royalty stream - with no risk - and we will pursue other opportunities to replicate this model if they arise.
D.W. MacDonald 30 September 2008
Operating and Financial review
Turnover for the year of �4,734,000 (2007: �5,033,000) produced an operating profit of �735,000 (2007: �1,343,000). The group profit for
the year after interest and taxation was �10,000 (2007: �498,000).
There was a tax credit earned in respect of research and development of �265,000 recorded for the year (2007: �nil) and tax losses
available to offset future profits are estimated at �8,688,000 (2007: �5,800,000).
The basic earnings per share for the year was 0.00p (2007: 0.20p).
Total liabilities of the group of �12,570,000 (2007: �12,047,000) include current liabilities of �5,994,000 (2007: �5,564,000). During
the year average headcount increased by 4% reflecting increased sales activity and a low staff turnover.
The statement of cash flows illustrates that there was an decrease in cash for the year of �519,000 (2007: increase of �694,000). This
is stated after the inflow of cash from operating activities of �291,000 (2007: inflow of �472,000) and the outflow of cash for interest
payments of �1,120,000 (2007: �958,000).
On behalf of the board
Stephen Casey
Financial Director
30 September 2008
Copies of the Annual Report and Accounts for the year ended 31 March 2008 will be posted to shareholders on 30 September 2008 and copies
will also be available from the Company's registered office.
Press Contact
Stephen Casey David Newton
IMS Maxims plc Dowgate Capital
Sandymount Advisers Limited
Station Road 46 Worship Street
Woburn Sands London EC2A 2EA
MK17 8RR
Tel: 01908 588800 Tel: 020 7492 4777
Fax: 01908 588819 Fax: 020 7492 4774
IMS Maxims plc
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 MARCH 2008
2008 2007
Note �'000 �'000
Sales revenue 2 4,734 5,033
Cost of sales (700) (120)
Gross profit 4,034 4,913
Administrative expenses (3,299) (3,570)
Operating profit 2 735 1,343
Finance costs 3 (1,120) (979)
Finance income 130 133
Pre-tax result for the year (255) 497
Tax credit 4 265 -
Net result for the year 10 497
Attributable to:
Minority interests - equity - (1)
Equity holders of the group 10 498
Profit per share for profit attributable to the
equity holders of the group during the year
- basic 0.00p 0.20p
- diluted
0.00p 0.20p
IMS Maxims plc
CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2008
2008 2007
Note �'000 �'000
ASSETS
Non-current assets
Property, plant and equipment 33 31
Intangible assets 3,616 2,814
Trade and other receivables 1,018 1,169
4,667 4,014
Current assets
Contract costs recoverable - 1,524
Trade and other receivables 3,738 1,778
Cash and cash equivalents 297 816
4,035 4,118
Total assets 8,702 8,132
EQUITY
Capital and reserves attributable to the group's
equity holders
Share capital 2,535 2,535
Share premium account 7,600 7,600
Merger reserve 3,600 3,600
Equity reserve 18 11
Cumulative translation reserve (60) (90)
Retained earnings (17,604) (17,614)
7 (3,911) (3,958)
Minority interest in equity 43 43
Total equity (3,868) (3,915)
LIABILITIES
Non-current liabilities
Borrowings 6,528 6,483
Deferred tax liability 48 -
Current liabilities
Trade and other payables 2,789 3,355
Borrowings 3,205 2,209
Total liabilities 12,570 12,047
Total equity and liabilities 8,702 8,132
IMS Maxims plc
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 MARCH 2008 2008 2007
�'000 �'000
Operating activities
Result for the year before tax (255) 497
Depreciation 19 26
Share based payment expense 7 8
Foreign exchange movements 65 (89)
Change in contract costs recoverable 1,524 (1,524)
Change in trade and other receivables (1,373) 583
Change in trade and other payables (686) 125
Interest paid 1,120 979
Interest received (130) (133)
291 472
Investing activities
Additions to property, plant and equipment (25) (18)
Additions to intangible fixed assets (612) -
Acquisition of Preview Health Limited net of cash
acquired 26 -
Interest received 130 133
(481) 115
Financing activities
Proceeds from bank loans 2,286 2,000
Repayment of bank loans (1,495) (963)
Discharge of finance lease liability - (6)
Proceeds from share issue - 34
Interest paid (1,120) (958)
(329) 107
Cash and cash equivalents, beginning of year 816 122
Net (decrease) / increase in cash and cash equivalents
(519) 694
Cash and cash equivalents, end of year 297 816
1 Basis of information in the preliminary announcement
The financial information in this preliminary announcement does not constitute the Company's statutory accounts for the periods ended 31
March 2008 or 31 March 2007 but is derived from those accounts.
Statutory Accounts for 2007 have been delivered to the Registrar of Companies and those for 2008 will be delivered following the
Company's annual general meeting. The auditors have reported on those accounts; their report was (i) unqualified, (ii) did not include a
reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and (iii) did not contain a
statement under section 237 (2) or (3) of the Companies Act 1985.
The preliminary announcement has been prepared in accordance with the accounting policies adopted under International Financial
Reporting Standards ("IFRS") for the first time with a transition date of 1 April 2006. The disclosures required by IFRS 1 "First-time
Adoption of International Financial Reporting Standards" concerning the transition from UK GAAP to IFRS can be found in the Interim
Announcement for the period ended 30 September 2007.
2 Segmental information
The business is organised and managed according to geographical segment. Each segment represents a strategic business unit that operates
in a different location.
Transfer prices between business segments are set on an arm's length basis in a manner similar to transactions with third parties. The
group's geographical segments are determined by the location of the group's assets and operations. Turnover is analysed by origination not
destination. The location of clients materially matches the origination of revenue.
Geographical Segments United Kingdom Europe Total
�'000 �'000
�'000
31 March 2008
Revenue
from external customers:
from segments 3,688 1,046 4,734
Group operating profit 236 499 735
Finance costs (990) - (990)
Taxation credit 265 - 265
Net (loss) / profit (489) 499 10
Geographical Segments United Kingdom Europe Total
�'000 �'000
�'000
31 March 2007
Revenue
from external customers:
from segments 4,144 889 5,033
Group operating profit 1,032 311 1,343
Finance costs (846) - (846)
Taxation expense - - -
Net profit 186 311 497
As a secondary method organising the business, three segments have been selected as these are separately identifiable businesses with
different models.
The Business Segments are made up from the following departments:
Clinical - Sales, Operations and Product Development
PAS - Customer Support
Royalty - being the Preview Heath Limited business acquired in this financial year
Business Segments PAS Clinicals�'000 Royalty Total �'000
�'000 �'000
31 March 2008
Revenue 2,566 2,168 - 4,734
Business Segments PAS Clinicals�'000 Royalty Total �'000
�'000 �'000
31 March 2007
Revenue 2,486 2,547 - 5,033
3 Interest expense
2008 2007
�'000 �'
000
Interest expense:
- bank borrowings 999 930
- other borrowings 121 49
1,120 979
4 Income tax expense
The tax on the group's profit before tax differs from the theoretical amount that would arise using the weighted average tax rate
applicable to profits of the Group as follows:
2008 2007
�'000 �'000
(Loss) / profit before tax (255) 497
Tax calculated at domestic tax rates applicable to profits (77) 65
in the respective countries
Adjustments for non-deductible expenses:
- Relating to goodwill impairment / amortisation 84
- Tax credits for research activities - -
(265)
- Utilisation of losses (68) -
- Other non deductible expenses 49 36
-(Profits)/losses arising in the year not taxed due to tax (150)
losses -
- Temporary differences - 167
- Current year losses not utilised 182 -
- Overseas tax difference (86) (202)
Actual tax (credit) / expense (265) -
2008 2007
�'000 �'
000
Comprising
Current tax (credit) / expense (77) 65
Deferred tax income, resulting from: (188) (65)
- origination and reversal of temporary differences
The weighted average applicable tax rate was 2% (2007: 2%).
5 Earnings per share
Basic earnings per share is calculated by dividing the profit attributable to equity holders of the group by the weighted average number
of ordinary shares in issue during the period.
2008 2007
� �
Profit attributable to equity holders of the group 10,000 498,000
Weighted average number of ordinary shares in issue
Basic 253,450,826 248,333,764
Dilutive effect of outstanding options - -
Diluted 253,450,826 248,333,764
Profit per share:
Basic and diluted 0.00p 0.20p
The exercise price of the options is in excess of the share price as at the year end 31 March 2007 and year end 31 March 2008, therefore
these options are anti-dilutive and as such have been excluded from the diluted EPS calculation.
6 Aim Compliance Committee
In accordance with AIM Rule 31 the Company is required to have in place sufficient procedures, resources and controls to enable its
compliance with the AIM Rules; seek advice from its nominated adviser ("Nomad") regarding its compliance with the AIM Rules whenever
appropriate and take that advice into account; provide the Company's Nomad with any information it requests in order for the Nomad to carry
out is responsibilities under the AIM Rules for Companies and the AIM Rules for Nominated Advisers; ensure that each of the Company's
directors accepts full responsibility, collectively and individually, for compliance with the AIM Rules; and ensure that each director
discloses without delay all information which the Company needs in order to comply with AIM Rule 17 (Disclosure of Miscellaneous
Information) insofar as that information is known to the director or could with reasonable diligence be ascertained by the director.
In order to ensure that these obligations are being discharged, the Board has established a committee of the Board (the "AIM
Committee"), chaired by David MacDonald, a non executive director of the Company. Having reviewed relevant Board papers, and met with the
Company's Executive Board to ensure that such is the case, the AIM Committee is satisfied that the Company's obligations under AIM Rule 31
have been satisfied during the period under review.
7 Statement of changes in equity
Share Share Merger Equity Cumulative Retained Total Minority Total
Share Share Merger Equity Cumulative Retained Total Minority Total
capital premium reserve reserve translation earnings Interest equity
reserve
�'000 �'000 �'000 �'000 �'000 �'000 �'000 �'000 �'000
As at 1 April 2006 2,341 6,490 3,600 140 - (18,112) (5,541) 44 (5,497)
Profit for the year - - - - - 498 498 (1) 497
Exchange differences on - - - - (90) - (90) - (90)
retranslation of subsidiaries
Total recognised income and - - - - (90) 498 408 (1) 407
expense
Issue of equity 194 1,110 - - - - 1,304 - 1,304
Conversion of CCRP shares - (136) - - (136) - (136)
Share based payment expense - 7 7 7
As at 31 March 2007 2,535 7,600 3,600 11 (90) (17,614) (3,958) 43 (3,915)
Profit for the year 10 10 - 10
Exchange differences on 30 30
retranslation of subsidiaries
Total recognised income and 30 10 40 - 40
expense
Share based payment expense 7 7 7
As at 31 March 2008 2,535 7,600 3,600 18 (60) (17,604) (3,911) 43 (3,868)
This information is provided by RNS
The company news service from the London Stock Exchange
END
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