RNS Number:9838R
Aquilo PLC
30 September 2005
Interim Results - for the period ended 30 June 2005
Aquilo Plc ("Aquilo") today announces its half year results for the period ended
30 June 2005.
Financial and Trading Highlights
Aquilo the support services business to the property and motor insurance sector,
today announces interim results for the first half of its 2005 financial year.
The first six months of 2005 was a transforming period for Aquilo. Foundations
were laid for the rapid growth of the property claims business including the
acquisition of HFC Select in March. ABS Bodyshop Services Ltd was acquired in
February to strengthen the motor services division. The sale and leaseback of
Meridian House was completed (ABS head office) and a new managing director was
appointed to build and grow the motor services division (start date 1st
September).
Financial Highlights
* Turnover up to #11.09m (2004: #1.83m).
* Gross Profit up to #2.07m (2004: #0.88m).
* Profit before interest #7,953 (2004: losses of #650,308).
Trading Highlights
* The strategic consultancy business has continued to build its' client base
and has proved itself an important differentiator for the Group, especially
post Spitzer.
* The property claims business showed excellent growth across all its
activities and will achieve in excess of #3m turnover by the end of 2005.
* The motor services business saw the acquisition of ABS Bodyshop Services
Ltd and the integration of services at Northwich. Delay in building the
customer base has resulted in a weakness in volume in the first half;
however, new contracts have already started in the second half.
* The Colindale office in North London was closed. The sale and leaseback
of Meridian House (Northwich) was completed so as to give a more flexible
asset base to underpin the organic growth strategy of the Group.
* Management's priorities are to achieve volume growth, continue to improve
operational structures and processes and ensure maximum efficiency in the
cost base of the Group.
Chairman's Statement
The first half of 2005 had a number of milestones; the acquisitions of ABS
Bodyshop Services Ltd and HFC Select, the substantial growth of the property
claims division, the closure of Colindale and the sale and leaseback of Meridian
House in Northwich. This amount of change has only been possible with the
continued commitment of key staff and advisors to the board. The directors
would like to thank all those involved.
At an operational level, the team has continued to make strides in developing
the client base, has successfully established new businesses and integrated the
acquisitions made during the period. The amount of new activity has been
substantial and the team is to be commended for its considerable efforts.
The transformation of the business during the first half of 2005 would not have
been possible without new funding and we would like to thank the Bank of
Scotland and our shareholders for their continued financial support.
Results
Turnover up to #11.09m (2004: #1.83m) as a result of organic growth and
acquisitions. Gross profit up to #2.07m (2004: #0.88m) and profit before
interest of #7,953 (2004: losses of #650,308).
Exceptional costs due to restructuring post ABS acquisition in excess of #0.35m
will give substantial benefits in 2005 and across future years.
An exceptional profit of #0.8m was generated on the sale of Meridian House in
Northwich.
Interest payable rose to #0.10m (2004: #0.07m) as a result of funding the
acquisitions.
The property claims division has exceeded expectations and will be ahead of plan
in the second half of 2005. The motor services division has been weak on volume
of sales but new client business has started in September which will produce
substantial, additional gross profit.
Overall, the Group is being transformed and the investments made in the first
half of 2005 are now starting to show returns.
Aquilo Strategic Services
This service is a highly valuable differentiator for the Group, especially post
Spitzer. During 2005 new contracts have started and new opportunities have been
delivered for the property and motor services divisions. This cross selling
will increase in importance over the coming years. A growth plan has been
developed which is now being executed to grow the resources of this business and
corresponding revenues in 2006.
Aquilo Business Solutions
This business deals with property claims and it has achieved excellent growth in
its three main areas of fraud management, claims validation and supply chain
fulfilment. It has rapidly grown its client list and the directors have every
confidence that the second half of 2005 will exceed plan and achieve profit
across 2005 as a whole and revenues in excess of #3m. Demand for its fraud
service, Rezolve, is very strong across a widening range of insurance categories
and the division is growing its resource base to meet the available demand.
Aquilo Motor Services
The key focus for this division post the acquisition of ABS Bodyshop Service Ltd
has been the integration of the various streams of activities in Meridian House,
Northwich so as to enable the closure of Colindale and obtain significant
financial savings. The first six months of 2005 saw weakness in demand and
delayed success in obtaining new customers and contracts. A key issue in the
period was to speed up the implementation of the new integrated claims (ICE)
system which is a critical element in expanding the range of services available,
especially first response. These investments are now paying dividends with new
clients having been signed and further gains will be made given the arrival of
the new managing director at the start of September.
Accidentcare
This business has maintained its position in the first half of 2005 through
broadening its partnership with Broker Assistance post the closure of the
Colindale premises in North London. This business is, however, not a key area
of focus for Aquilo and the board has been considering a range of strategic
options including disposal to a third party.
Outlook
The directors of Aquilo see a very positive outlook for 2006 building on all the
activities of 2005. Furthermore, the second half of 2005 will be profitable in
its own right through delivering new revenues and continuing to control the cost
base of the company.
A small number of very large strategic growth opportunities are being worked on;
any one of which will reinforce Aquilo's position as an innovative industry
leader and build sustainable financial returns for shareholders.
For further information please contact:
Alan Frame, Equity Development Limited, Tel: 0207 405 7777
Alasdair Robinson, Noble & Company Limited, Tel: 0131 225 9677
AQUILO PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Notes Unaudited six Unaudited six
months to 30 June months to 30 June
2005 2004
# #
Turnover 11,085,342 1,827,405
Cost of Sales 9,011,109 944,080
_________ ________
Gross Profit 2,074,233 883,325
Operating/administrative expenses 2,535,374 1,433,431
_________ ________
Operating loss (461,141) (550,106)
Exceptional items 469,094 (100,202)
_________ ________
Profit/(loss) on ordinary activities before 7,953 (650,308)
interest
Interest Receivable 10,765 2,687
Interest Payable (102,950) (70,588)
_________ ________
Loss on ordinary activities before taxation (84,232) (718,209)
Tax on losses on ordinary activities 0 0
_________ ________
Retained loss for period (84,232) (718,209)
_________ ________
Loss per share
Basic 3 (0.03p) (0.5p)
AQUILO PLC
CONSOLIDATED BALANCE SHEET
Notes Unaudited as at Unaudited as at
30 June 2005 30 June 2004
# #
Fixed Assets
Intangible assets - negative goodwill (8,201) 0
Intangible assets - other 1,139,770 249,800
Tangible assets 670,708 126,116
Investments 176,549 118,600
________ ________
1,978,826 494,516
________ ________
Current Assets
Stock and work in progress 144,301 0
Debtors 4 4,592,135 1,194,702
Cash at bank and in hand 1,033,142 487,512
________ ________
5,769,578 1,682,214
________ ________
Total Assets 7,748,404 2,176,730
________ ________
Creditors:
Amounts falling due within one year 5 4,926,003 1,193,286
Creditors:
Amounts falling due after more than one year 6 1,899,097 0
Provisions for liabilities and charges 48,256 36,000
________ ________
6,873,356 1,229,286
Capital and Reserves
Called up share capital 3,219,646 2,907,531
Share premium account 1,133,581 1,150,328
Shares not yet issued 250,000 0
Profit and loss account (3,741,529) (3,110,415)
Minority interest * 13,350 0
_______ ________
875,048 947,444
________ ________
Total Liabilities 7,748,404 2,176,730
________ ________
* - Minority Interest - relates to 1.33% holding in ABS Bodyshop Services
Limited by repairers.
AQUILO PLC
CONSOLIDATED CASH FLOW STATEMENT
Notes Unaudited six Unaudited six
months to 30 June months to 30 June
2005 2004
# #
Cash Flow Statement
Cash flow from operating activities 7 (966,213) (1,035,884)
Returns on investment and servicing of finance (92,185) (76,267)
Taxation 0 0
Capital expenditure and financial investment (634,869) (284,326)
Equity dividends paid 0 0
_________ __________
Cash outflow before management of liquid (1,693,267) (1,396,477)
resources and financing
Financing 2,594,437 2,362,391
_________ __________
Increase in cash in the period 901,170 965,914
_________ __________
Reconciliation of net cash flow movement in
net debt
Increase in cash in the period 901,170 965,914
Cash outflow from changes in net debt 0 8,920
Loan stock converted into share capital 0 795,000
________ _________
Movement in net funds in the period 901,170 1,769,834
Net funds/(debt) at the start of the period 9,101 (1,282,322)
________ __________
Net funds at the end of the period 910,271 487,512
________ __________
AQUILO PLC
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS FUNDS
Unaudited six Unaudited six
months to 30 June months to 30 June
2005 2004
# #
Loss for the financial period (84,232) (718,209)
Shares issued 312,115 1,980,466
Share premium on shares issued 234,089 1,485,350
Costs set off against share premium account (227,375) (369,442)
Disposal of Aquilo Technology Ltd 0 252,489
Dormant subsidiaries dissolved 0 (1,602)
Minority interests 13,350 0
________ _________
Net addition to shareholders funds 247,946 2,629,052
Opening shareholders funds 627,102 (1,681,608)
________ _________
Closing shareholders funds 875,048 947,444
________ _________
AQUILO PLC
NOTES TO THE ACCOUNTS
1. Basis of Preparation
The financial information contained in these statements for the six months ended
30 June 2005 and 30 June 2004 is unaudited and does not constitute statutory
accounts as defined in Section 240 of the Companies Act 1985.
The financial information for the year ended 31 December 2004 has been extracted
from the statutory accounts for that period which carried an unqualified audit
report and which have been filed with the Registrar of Companies.
Copies of the Interim Report are available from the Company Secretary, Meridian
House, Gadbrook Park, Northwich, Cheshire, CW9 7RA.
2. Taxation
There is estimated to be no tax charge for the period.
3. Earnings per share
The earnings per share is based on the loss for the period of #95,061 (30 June
2004: #718,209 loss) and the weighted average number of ordinary shares in issue
for the six months ended 30 June 2005 of 319,409,422 (30 June 2004:
154,732,021).
4. Debtors
Unaudited 30 June Unaudited 30 June
2005 2004
# #
Trade debtors 3,346,272 650,964
Other debtors 730,422 380,726
Prepayments and accrued income 515,441 163,012
________ ________
4,592,135 1,194,702
________ ________
The figure for trade debtors is unusually high as the balance includes #1.6
million net due in relation to the sale of Meridian House.
5. Creditors: amounts falling due within one year
Unaudited 30 June Unaudited 30 June
2005 2004
# #
Bank overdraft 122,871 0
Bank loan 265,000 0
Other loans 100,681 0
Trade creditors 3,128,434 690,395
Net obligations under finance lease and hire purchase contracts 10,837 0
Corporation tax 10,281 0
Taxation and social security 717,949 102,157
Other creditors 302,200 242,053
Accruals and deferred income 267,750 158,681
________ ________
4,926,003 1,193,286
________ ________
The amount due for taxation and social security is unusually high as this
includes #542,500 VAT payable in relation to the sale of Meridian House.
6. Creditors: amounts falling due after on year
Unaudited 30 June Unaudited 30 June
2005 2004
# #
Bank loan 993,750 0
Other loans 109,122 0
Loan notes 792,438 0
Net obligations under finance lease and hire purchase contracts 3,787 0
________ ________
1,899,097 0
________ ________
7. Reconciliation of operating loss to operating cash flows
Unaudited 30 June Unaudited 30 June
2005 2004
# #
Operating loss (461,141) (550,106)
Depreciation, amortisation and impairment charges 106,693 41,173
Movement in debtors (3,480,990) (455,339)
Movement in creditors 3,352,045 28,590
Movement in stock and work in progress (144,301) 0
Exceptional items (338,519) (100,202)
_________ _________
Net cash outflow from operating activities (966,213) (1,035,884)
_________ _________
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