TIDMCNC
RNS Number : 9613Q
Concurrent Technologies PLC
18 September 2017
18 September 2017
Concurrent Technologies Plc
(the "Company" or the "Group")
Interim Results for the six months ended 30 June 2017
Concurrent Technologies Plc (AIM: CNC), a world leading
specialist in the design and manufacture of high-end embedded
computer boards for critical applications, announces interim
results for the six months to 30 June 2017.
Financial Highlights
-- Turnover of GBP7.8m (H1 2016: GBP9.0m)(1)
-- Gross profit GBP4.3m (H1 2016: GBP4.9m)
-- Gross margin maintained at 54.8% (H1 2016: 54.8%)
-- Profit before tax of GBP1.4m (H1 2016: GBP1.5m)
-- EPS of 1.84 pence (H1 2016: 2.12 pence)
-- Interim dividend increased by 12.5% to 0.90p per share (H1 2016: 0.80p)
-- Cash balance (including cash deposits) at 30 June 2017 of GBP7.9m (H1 2016: GBP8.2m)
1. H1 2016 turnover was inflated by an exceptional sale
Operational Highlights
-- Defence related sales, in particular from US customers, now
account for more than half of the Group revenues and continue to
drive the business
-- Expanding global customer base with exports generating 84% of Group revenues (H1 2016: 81%)
-- GBP1.2m invested into R&D during the period, resulting in
strong pipeline of future product releases
-- Release of two new rugged conduction-cooled boards, plus the
launch of new range of Intel(R) Xeon(R) boards during the
period
Michael Collins, Chairman of Concurrent Technologies Plc,
commented:
"After a solid performance in the first-half of the year we have
started the second-half with an expanding list of customers, many
new opportunities and a strong balance sheet. The outlook for the
future remains positive."
Enquiries:
Concurrent Technologies
Plc
Glen Fawcett, CEO +44 (0)1206 752 626
Newgate (Financial PR)
Bob Huxford
James Browne +44 (0)207 653 9850
Cenkos Securities plc (NOMAD)
Neil McDonald +44 (0)131 220 9771
Nick Tulloch +44 (0)131 220 9772
Beth McKiernan +44 (0)131 220 9778
About Concurrent Technologies Plc
Concurrent Technologies Plc develops and manufactures high-end
embedded computer products for use in a wide range of high
performance, long life cycle applications within the
telecommunications, defence, security, telemetry, scientific and
aerospace markets, including applications within extremely harsh
environments. The processor products traditionally feature Intel(R)
processors, including the latest generation Intel(R) Core(TM) i7
processors, Intel(R) Xeon(R) and Intel(R) Atom(TM) processors. More
recently NVIDIA(R) Tegra(R) K1 devices have been added to the
product ranges along with complementary switch and I/O boards. The
products are designed to be compliant with industry specifications
and support many of today's leading embedded Operating Systems. The
products are sold world-wide.
For more information on Concurrent Technologies Plc and its
products please visit www.cct.co.uk
All trademarks, registered trademarks and trade names used in
this announcement are the property of their respective owners.
CHAIRMAN'S STATEMENT
Financial Summary
I am pleased to report a good performance for the first-half of
2017, consolidating the strong performances from the last two
years.
Revenue for the period was GBP7.8m (H1 2016: GBP9.0m), the
variance is largely due to an exceptional sale in early 2016 and
defence customer delays in H1 2017. Gross profitability was GBP4.3m
(H1 2016: GBP4.9m). Gross margins were maintained at 54.8% (H1
2016: 54.8%). The unaudited profit before tax for the same period
was GBP1.4m (H1 2016: GBP1.5m) with associated earnings per share
of 1.84 pence (H1 2016: 2.12 pence).
The Group balance sheet has been strengthened with cash balances
(including cash deposits) at
30 June 2017 of GBP7.9m (H1 2016: GBP8.2m) and total equity
increased to GBP18.0m (H1 2016: GBP16.7m).
Dividend
The Board has declared a first interim dividend of 0.90p per
share (H1 2016: 0.80p) - an increase of 12.5%. The total cost of
this dividend will amount to GBP654,466. The ex-dividend date for
this interim dividend is 28 September 2017, the record date is 29
September 2017 and the payment date is 13 October 2017.
Review of Operations
Defence related revenues continue to drive the business, in
particular from US customers, who now account for more than half of
the Group sales. Exports generated 84% of total Group revenues (H1
2016: 81%). During this reporting period, many new customers have
been gained.
The Group invested GBP1.2m during H1 2017 (H1 2016: GBP1.2m) in
research and development for new products and their associated
variants. This investment in innovative engineering solutions
should help safeguard revenues in future years. Many products have
completed exhaustive testing in the first-half of 2017 and the
pipeline for future product releases is encouraging.
The Company still awaits confirmation of the trade and tariff
legislation to be agreed by the UK Government with other countries.
Because most countries, including the USA and those of the European
Union, apply a zero-percentage import tariff rating to our products
we don't expect our business to be affected. The vote to leave the
European Union has had little impact on trading; the main effect
has been seen in the difficulty of recruiting non-UK research and
development engineers to work in the UK and we wait to see if this
is just a temporary situation.
Future Plans
We will continue to expand our product ranges through the
development of new boards and systems together with complementary
software. In particular, we will focus on our VPX(TM) products in
both ruggedized and non-ruggedized variants. These new products
will be designed for our key market sectors of complex, high
technology, low to medium volume and high margin applications.
To improve the development process, the Group will this year
invest in more development equipment including a sophisticated
multi-gigabit per second high-speed analyser. In addition, to
provide a more flexible response to customer orders, a faster "pick
and place" machine will be acquired in mid-2018. This type of
machine is used for high-speed, fine-precision placement of
surface-mount components onto printed circuit boards.
Outlook
After a solid performance in the first-half of the year we have
started the second-half with an expanding list of customers, many
new opportunities and a strong balance sheet. The outlook for the
future remains positive.
Michael Collins
Chairman
15(th) September 2017
All companies and product names are trademarks of their
respective organisations.
CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
unaudited interim results to 30 June 2017
Six months Six months Year
ended ended ended
Note 30/06/17 30/06/16 31/12/16
GBP GBP GBP
CONTINUING OPERATIONS
Revenue 7,816,472 8,970,694 16,423,978
Cost of sales 3,536,288 4,054,125 7,529,867
=================================== ==== ================== ================== ==================
Gross profit 4,280,184 4,916,569 8,894,111
Net operating expenses 2,914,116 3,397,753 6,040,302
=================================== ==== ================== ================== ==================
Group operating profit 1,366,068 1,518,816 2,853,809
Finance income 30,375 26,336 48,705
=================================== ==== ================== ================== ==================
Profit before tax 1,396,443 1,545,152 2,902,514
Tax 56,997 4,824 72,609
=================================== ==== ================== ================== ==================
Profit for the period 1,339,446 1,540,328 2,829,905
=================================== ==== ================== ================== ==================
Other Comprehensive Income
Exchange differences on
translating foreign operations (93,622) 223,385 415,966
Tax relating to components - - -
of other comprehensive
income
=================================== ==== ================== ================== ==================
Other Comprehensive Income
for the period, net of
tax (93,622) 223,385 415,966
=================================== ==== ================== ================== ==================
Total Comprehensive Income
for the period 1,245,824 1,763,713 3,245,871
=================================== ==== ================== ================== ==================
Profit for the period attributable
to:
=================================== ==== ================== ================== ==================
Equity holders of the parent 1,339,446 1,540,328 2,829,905
=================================== ==== ================== ================== ==================
Total Comprehensive Income
attributable to:
=================================== ==== ================== ================== ==================
Equity holders of the parent 1,245,824 1,763,713 3,245,871
=================================== ==== ================== ================== ==================
Earnings per share
Basic earnings per share 4 1.84p 2.12p 3.90p
Diluted earnings per share 4 1.84p 2.12p 3.90p
CONDENSED CONSOLIDATED BALANCE SHEET
unaudited interim results to 30 June 2017
As at As at As at
30/06/17 30/06/16 31/12/16
ASSETS GBP GBP GBP
Non-current assets
Property, plant and equipment 391,651 643,786 414,209
Intangible assets 7,369,683 6,397,135 6,846,520
Deferred tax assets 146,023 101,361 112,128
7,907,357 7,142,282 7,372,857
Current assets
Inventories 3,334,750 2,870,131 3,239,855
Trade and other receivables 2,526,923 2,642,486 3,327,629
Current tax assets 203,710 163,180 93,156
Other financial assets - - 1,000,000
Cash and cash equivalents 7,885,032 8,179,993 6,773,083
=============================== ================ ================ ================
13,950,415 13,855,790 14,433,723
Total assets 21,857,772 20,998,072 21,806,580
=============================== ================ ================ ================
LIABILITIES
Non-current liabilities
Deferred tax liabilities 1,417,245 1,280,077 1,291,468
Long term provisions 3,986 10,398 6,699
=============================== ================ ================ ================
1,421,231 1,290,475 1,298,167
Current liabilities
Trade and other payables 2,384,949 2,938,487 2,810,655
Short term provisions 19,932 32,712 23,939
Current tax liabilities - 6,735 -
============================== ================ ================ ================
2,404,881 2,977,934 2,834,594
Total liabilities 3,826,112 4,268,409 4,132,761
=============================== ================ ================ ================
Net assets 18,031,660 16,729,663 17,673,819
=============================== ================ ================ ================
EQUITY
Capital and reserves
Share capital 739,000 739,000 739,000
Share premium account 3,684,871 3,693,818 3,693,818
Capital redemption reserve 256,976 256,976 256,976
Cumulative translation
reserve 400,985 302,026 494,607
Profit and loss account 12,949,828 11,737,843 12,489,418
=============================== ================ ================ ================
Equity attributable to
equity holders of the parent 18,031,660 16,729,663 17,673,819
Total equity 18,031,660 16,729,663 17,673,819
=============================== ================ ================ ================
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
unaudited interim results to 30 June 2017
Six months Six months Year
ended ended ended
30/06/17 30/06/16 31/12/16
GBP GBP GBP
Cash flows from operating
activities
Profit before tax for the
period 1,396,443 1,545,152 2,902,514
Adjustments for:
Finance income (30,375) (26,336) (48,705)
Depreciation 77,624 98,966 196,370
Amortisation 620,878 627,065 1,254,826
Impairment loss 31,064 499,509 499,509
Loss on disposal of property,
plant and equipment - - 233,840
Share-based payment 13,611 1,139 13,585
Exchange differences (200,228) 272,299 76,461
(Increase)/decrease in
inventories (94,895) 904,154 534,430
(Increase)/decrease in
trade and other receivables 800,706 (121,913) (927,530)
Increase/(decrease) in
trade and other payables (432,426) 528,208 558,815
================================== ================= ================ ================
Cash generated from operations 2,182,402 4,328,243 5,294,115
Tax received/(paid) (32,395) 120,715 116,142
================================== ================= ================ ================
Net cash generated from
operating activities 2,150,007 4,448,958 5,410,257
================================== ================= ================ ================
Cash flows from investing
activities
Interest received 30,375 26,336 48,705
Cash released from/(placed
on) deposit 1,000,000 1,000,000 -
Purchases of property,
plant and equipment (56,977) (43,728) (138,181)
Proceeds from sale of property, - - -
plant and equipment
Purchases of intangible
assets (1,175,613) (1,214,874) (2,290,889)
================================== ================= ================ ================
Net cash used in investing
activities (202,215) (232,266) (2,380,365)
================================== ================= ================ ================
Cash flows from financing
activities
Equity dividends paid (945,339) (870,942) (1,452,689)
Sale/(purchase) of treasury
shares - 19,800 51,800
Net cash used in financing
activities (945,339) (851,142) (1,400,889)
================================== ================= ================ ================
Effects of exchange rate
changes on cash and cash
equivalents 109,496 (59,372) 270,265
Net increase/(decrease)
in cash 1,111,949 3,306,178 1,899,268
Cash at beginning of period 6,773,083 4,873,815 4,873,815
================================== ================= ================ ================
Cash at the end of the
period 7,885,032 8,179,993 6,773,083
================================== ================= ================ ================
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
unaudited interim results to 30 June 2017
Capital Cumulative Profit
Share Share redemption translation and loss Total
capital Premium reserve reserve account equity
GBP GBP GBP GBP GBP GBP
Balance at 1 January
2016 739,000 3,693,818 256,976 78,641 11,053,079 15,821,514
Profit for the period - - - - 1,540,328 1,540,328
Exchange differences
on translating foreign
operations - - - 223,385 - 223,385
======================== ======== ========= =========== ============ ========== ==========
Total recognised
comprehensive income
for the period - - - 223,385 1,540,328 1,763,713
Share-based payment - - - - 1,139 1,139
Deferred tax on
share based payment - - - - (5,561) (5,561)
Dividends paid - - - - (870,942) (870,942)
Sale of treasury
shares - - - - 19,800 19,800
Balance at 30 June
2016 739,000 3,693,818 256,976 302,026 11,737,843 16,729,663
======================== ======== ========= =========== ============ ========== ==========
Profit for the period - - - - 1,289,577 1,289,577
Exchange differences
on translating foreign
operations - - - 192,581 - 192,581
======================== ======== ========= =========== ============ ========== ==========
Total recognised
comprehensive income
for the period - - - 192,581 1,289,577 1,482,158
Share-based payment - - - - 12,446 12,446
Deferred tax on
share based payment - - - - (701) (701)
Dividends paid - - - - (581,747) (581,747)
Purchase of treasury
shares - - - - 32,000 32,000
Balance at 31 December
2016 739,000 3,693,818 256,976 494,607 12,489,418 17,673,819
======================== ======== ========= =========== ============ ========== ==========
Profit for the period - - - - 1,339,446 1,339,446
Exchange differences
on translating foreign
operations - - - (93,622) - (93,622)
======================== ======== ========= =========== ============ ========== ==========
Total recognised
comprehensive income
for the period - - - (93,622) 1,339,446 1,245,824
Share-based payment - - - - 13,611 13,611
Deferred tax on
share based payment - - - - 43,274 43,274
Dividends paid - - - - (945,339) (945,339)
Sale of treasury
shares - (8,947) - - 9,418 471
Balance at 30 June
2017 739,000 3,684,871 256,976 400,985 12,949,828 18,031,660
======================== ======== ========= =========== ============ ========== ==========
NOTES TO THE INTERIM REPORT
1. General information
The principal activity of Concurrent Technologies
Plc and its subsidiaries ("the Group") is the
design, development, manufacture and marketing
of single board computers for system integrators
and original equipment manufacturers.
Concurrent Technologies Plc ("the Company")
is the Group's ultimate parent company. It
is incorporated and domiciled in Great Britain.
Concurrent Technologies Plc shares are listed
on the Alternative Investment Market of the
London Stock Exchange.
The Group's condensed consolidated interim
financial statements are presented in pounds
sterling (GBP), which is also the functional
currency of the parent company.
These condensed consolidated interim financial
statements, which are unaudited, have been
approved for issue by the Board of Directors
on 15(th) September, 2017.
The information relating to the six months
ended 30 June 2017 and 30 June 2016 is unaudited
and does not constitute statutory accounts
within the meaning of section 434 of the Companies
Act 2006. The statutory accounts for the year
ended 31 December 2016, prepared in accordance
with IFRSs (International Financial Reporting
Standards) as adopted by the European Union,
have been reported on by the Group's auditors
and delivered to the Registrar of Companies.
The auditors' report was unqualified, did not
draw attention to any matters by way of emphasis
and did not contain a statement under section
498(2) or (3) of the Companies Act 2006.
2. Summary of significant accounting policies
2.1 Basis of preparation
These condensed consolidated interim financial
statements are for the six months ended 30
June 2017. They have been prepared in accordance
with IAS 34 "Interim Financial Reporting".
They do not include all of the information
required for full annual financial statements,
and should be read in conjunction with the
consolidated financial statements of the Group
for the year ended 31 December 2016, which
have been prepared in accordance with adopted
IFRSs.
The accounting policies applied and methods
of computation are consistent with those of
the annual financial statements for the year
ended 31 December 2016, as described in those
financial statements. The accounting policies
have been consistently applied to all the periods
presented.
There are no new IFRSs or IFRIC interpretations
that are effective for the first time for the
financial period beginning on or after 1 January
2017 that would be expected to have a material
impact on the results or financial position
of the Group.
2.2 Going Concern
The Directors are satisfied that the Group
has sufficient resources to continue in operation
for the foreseeable future, a period of not
less than 12 months from the date of this report.
Accordingly, they continue to adopt the going
concern basis in preparing these condensed
financial statements.
2.3 Taxation
Current tax expense is recognised in these
condensed consolidated interim financial statements
based on estimated effective tax rates for
the full year.
3. Segmental reporting
The Directors consider that the Group is engaged
in a single segment of business, being design,
manufacture and supply of high-end embedded
computer products, and that therefore the Company
has only a single operating segment. The key
measure of performance used by the Board to
assess the Group's performance is the Group's
profit before tax, as calculated under IFRS,
and therefore no reconciliation is required
between the measure of profit or loss used
by the Board and that contained in the condensed
consolidated interim financial statements.
4. Earnings per share
Basic earnings per share is calculated by dividing
the profit attributable to ordinary equity
holders for the period by the weighted average
number of ordinary shares outstanding during
the period.
Diluted earnings per share is calculated adjusting
the weighted average number of ordinary shares
outstanding to assume conversion of all contracted
dilutive potential ordinary shares. The Company
only has one category of dilutive potential
ordinary shares, share options.
The inputs to the earnings per share calculation
are shown below:
Six months Six months
ended ended Year ended
30/06/17 30/06/16 31/12/16
GBP GBP GBP
Profit attributable
to ordinary equity holders 1,339,446 1,540,328 2,829,905
============================= =========== =========== ===========
Six months Six months
ended ended Year ended
30/06/17 30/06/16 31/12/16
N(o) N(o) N(o)
Weighted average number
of ordinary
shares for basic earnings
per share 72,718,490 72,604,009 72,635,976
Adjustment for share
options 2,457 481 2,457
============================= =========== =========== ===========
Weighted average number
of ordinary shares for
diluted earnings per
share 72,720,947 72,604,490 72,638,433
============================= =========== =========== ===========
5. Post reporting date events
There were no material events subsequent to
the end of the interim reporting period that
have
not been reflected in these interim financial
statements.
6. Shareholder Communication
A copy of this interim statement is available
from the Company's Registered Office at 4 Gilberd
Court, Newcomen Way, Colchester, Essex, CO4
9WN, UK and from the Company's website at www.cct.co.uk.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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