TIDMMGP
RNS Number : 9482Q
Medica Group PLC
18 September 2017
18 September 2017
Medica Group PLC
Unaudited half year results for the six months ended 30 June
2017
Maiden interim results delivering double digit growth
Medica Group PLC (LSE:MGP, "Medica" or the "Company"), the UK
market leader by revenue in the provision of teleradiology
services, today announces its half year results for the six months
ended 30 June 2017.
Six months Six months % change
ended 30 ended 30
June 2017 June 2016
------------------------- ----------- ----------- ---------
Revenue(GBP'000s) 15,723 13,435 17.0%
------------------------- ----------- ----------- ---------
Gross profit (GBP'000s) 7,644 6,803 12.4%
------------------------- ----------- ----------- ---------
Gross profit margin
(%) 48.6% 50.6%
------------------------- ----------- ----------- ---------
Adjusted EBITDA (1)
(GBP'000s) 4,873 4,319 12.8%
------------------------- ----------- ----------- ---------
Adjusted operating
profit (2) (GBP'000s) 4,325 3,767 14.8%
------------------------- ----------- ----------- ---------
Adjusted profit before
tax (3) (GBP'000s) 3,847 2,707 42.1%
------------------------- ----------- ----------- ---------
Adjusted EPS (pence)
(4) 3.14 2.23 40.8%
------------------------- ----------- ----------- ---------
EBITDA cash conversion
(%) (5) 61.1% 67.2%
------------------------- ----------- ----------- ---------
(1) EBITDA is a non-IFRS measure and is calculated as operating
profit before depreciation, amortisation, exceptional items, and
share based payments.
(2) Adjusted operating profit is a non-IFRS measure and is
calculated as operating profit before exceptional items, certain
exceptional costs relating to refinancing, share based payments and
amortisation in respect of assets acquired on acquisition.
(3) Adjusted profit before tax is a non-IFRS measure and is
calculated as profit before tax before exceptional items (including
certain exceptional costs relating to refinancing), share based
payments and amortisation in respect of assets acquired on
acquisition.
(4) Adjusted Earnings per share is a non-IFRS measure and is
calculated as Earnings per share before exceptional items
(including certain exceptional costs relating to refinancing),
share based payments and amortisation in respect of assets acquired
on acquisition
(5) EBITDA cash conversion % is calculated as Cash Flows from
Operating activities pre-exceptional items and pre tax payments
divided by Adjusted EBITDA
Financial highlights
-- Delivered revenue growth of 17.0%
o NightHawk continued to see significant growth, with revenue
increasing by 18.6% to GBP7.7m
o Cross Sectional performed well, with revenue increasing by
23.3% to GBP5.8m
o Plain Film revenue fell by 8.3% to GBP1.8m, reflecting
strategy to focus on NightHawk and Cross Sectional
o Specialist services and Independent revenue increased by 47.6%
to GBP0.4m
-- Gross profit margin of 48.6% (50.6% in 2016) in line with expectations
-- Adjusted operating profit increased by 14.8% to GBP4.3m
-- Net debt significantly reduced to GBP8.5m (2016: GBP24.6m)
-- EBITDA cash conversion 61% (67% in H1 2016) in line with expectations
Operational highlights
-- Total number of reported body parts increasing by 6.5%
o NightHawk and Cross Sectional reported body parts increased by
26.1% and 31%, respectively, well ahead of market
o Plain Film reported body parts decreased by 9.0%
-- Continued to recruit strongly and added a net 19 radiologists
in the period, taking the total to 267 contracted radiologists
(including radiographers and rheumatologists) as at 30 June 2017
(June 2016: 214)
Post Period End
-- Strong recruitment since 30 June 2017, adding a further 24
radiologists, increasing the number of contracted radiologists to
291 as at 18 September 2017
John Graham, Chief Executive Officer of Medica, commented:
"I am pleased to be able to report continued strong demand for
Medica's services. Our strategy to increase penetration of the
NightHawk and Cross Sectional services drove double-digit revenue
growth in the first half of 2017.
Our strong track record of delivering organic growth has allowed
us to continue to invest in building a scalable platform and
attract consultant radiologists to meet the increased demand. Our
market leading platform and reputation for high quality clinical
governance positions us well to take advantage of the many growth
opportunities we have identified. We remain confident in Medica's
long-term prospects and are on track to meet market expectations as
we enter the traditionally stronger second half to the year."
For further information, please contact:
Medica Group: +44 (0)33 33 111 222
John Graham, Chief Executive Officer
Tony Lee, Chief Financial Officer
Investec Bank plc +44 (0)20 7597 5970
Sara Hale
Daniel Adams
Henry Reast
Edward Thomas
David Herring
FTI Consulting +44 (0)20 3727 1000
Brett Pollard
Ben Atwell
Victoria Foster Mitchell
Robert Winder
INTERIM MANAGEMENT REPORT
Chairman's statement
I am pleased to present Medica Group PLC's first interim
financial statements as a public company.
Strategy for success
Medica continued to grow strongly in the first half of 2017, and
achieved double-digit growth for both revenue (17%) and adjusted
operating profit (15%).
The teleradiology market continued to develop and demand from
clients grew strongly as NHS Trusts continued to face capacity
pressure and seek efficient solutions of high clinical quality.
Medica's strategy continues to be to provide the highest quality
clinical services and to promote improvements in clinical quality
across the NHS. Medica's goal is to work in partnership with NHS
Trusts and independent providers to reduce waiting times and
improve patient outcomes. Through this approach, Medica can
continue to lead the growth of teleradiology in the UK.
Medica has continued to perform well in the first half of the
year. In May, the NHS suffered from cyber-attacks, which did not
affect Medica's own systems and IT infrastructure, and the Company
was quick to work closely with affected clients to minimise patient
impact and to ensure that Medica could respond to referrals as soon
as these clients were back on line.
Providing a supportive environment to Medica's radiologists is a
key factor in the continued success of the Group. Medica has
developed an industry leading Clinical Governance platform that is
an important factor in recruiting and retaining radiologists.
Medica has a healthy pipeline of radiologists, increasing its
cohort by 19 during the period, taking the total to 267 contracted
radiologists (including radiographers and rheumatologists) as at 30
June 2017. Medica employed its first full time radiologist at the
end of June. Recruitment is expected to accelerate in the second
half of the year.
Initial public offering
A key milestone for Medica during the period was the Company's
oversubscribed successful listing on the Main Market of the London
Stock Exchange on 21 March 2017. Medica completed a successful
initial public offering, raising gross proceeds of GBP121 million
at 135 pence per ordinary share, of which GBP15m was for the
Company. Proceeds were used primarily to repay debt and associated
listing costs. These funds, alongside the Company's continued cash
generation, have enabled net debt to reduce to GBP8.5m at the end
of June.
Dividends
Medica proposes to pay its first interim dividend of 0.55 pence
per ordinary share on 27 October 2017 to shareholders on the
register at 29 September 2017.
Outlook
Momentum continues to build across the business as a result of
an increasing client portfolio, alongside broadening the service
offering to new and existing customers. Medica remains committed to
investing in developing new services and recruiting new
radiologists to meet the growing demand for our services. Medica's
strong brand, growing customer base and track record position us
well to achieve our growth targets and perform in line with market
expectations.
Roy Davis
Chairman
Financial and Business Review
Introduction
Medica is the UK market leader in the provision of teleradiology
services. The Group currently has one business segment of
teleradiology offering three primary services to hospital radiology
departments: NightHawk, Routine Cross Sectional (Routine CS) and
Routine Plain Film (Routine PF).
NightHawk is an out of hours emergency reporting service which
is focused on delivering accurate reports within fast turnaround
times and represented Medica's largest revenue contributor.
NightHawk typically provides reporting on CT scans. The second and
third key service offerings, Routine CS and Routine PF, are
designed to assist hospital radiology departments in managing their
demand/supply imbalance for less urgent daytime reporting on
examinations. Routine CS covers a combination of CT and MRI scans
(both forms of cross sectional scan) while Routine PF covers plain
film examinations and both services typically have a 48 hour
turnaround time.
Overview of performance in 2017
Medica, once again, showed strong double-digit growth in H1
2017. The Group recorded revenue of GBP15.7m for the first six
months of the year, an increase of 17.0% on the equivalent period
of 2016. This growth was largely driven by volume growth in
NightHawk and Cross Sectional services.
As anticipated gross profit margin edged down from 50.6% to
48.6%, reflecting the on-going renewal of the Group's contracts at
marginally lower prices as a result of the development of the
teleradiology market and the opening up of outsourcing. Despite
this, the reduction in average price has been more than compensated
by increases in volume.
The successful listing in March led to customary additional
costs, which added an additional 4% to total overheads in the
period. Overheads remained controlled in the period, increasing
only 9.3% on 2016 on a comparative basis as the business continues
to demonstrate its ability to leverage growth.
The result is the adjusted operating profit for the period of
GBP4.3m was 14.8% higher than 2016, which represents continuing
good progress for the business.
Service Lines
NightHawk
NightHawk continued to be Medica's largest service line, with H1
2017 revenue of GBP7.7m representing 49% of the total (H1 2016:
48%).
Revenue growth in H1 2017 from the prior period was 18.6%, with
the volume of reported body parts increasing by 26.1%. The gross
profit margin fell from 52.0% to 50.3%.
The majority of the growth has continued to come from increased
emergency service requirements from existing clients as Medica's
builds its partnerships with NHS Trusts and continues to improve
its service.
Routine Cross Sectional
Routine Cross Sectional (CT and MR) contributed H1 2017 revenue
of GBP5.8m, representing 37% of the total (H1 2016: 35%).
Revenue growth in H1 2017 from the prior period was 23.3%, with
the volume of reported body parts increasing by 31.0%. The gross
profit margin fell from 54.1% to 51.9%.
The majority of the growth has come from increased collaboration
with existing clients as NHS Trusts consider Medica a key part of
their capacity structure.
Routine Plain Film
During the period, Plain Film volumes were actively managed,
allowing the Group to focus on the faster growing Routine Cross
Sectional service. In line with expectations, all service lines
grew in H1 2017 apart from Routine Plain Film. Revenue of GBP1.8m
represents 11.5% of the total (2016: 14.7%).
Revenue fell from last year by 8.3% with the volume of reported
body parts falling by 9.0%. The gross profit margin fell from 54.3%
to 49.3%.
Medica's strategy, outlined in the Group's FY2016 results, to
launch its Radiographer Reporting service, utilising highly skilled
and qualified radiographers to conduct PF reporting, is already
showing success, representing 9.5% of total plain film volume and
capacity is expected to continue to build.
Other Service Lines
A strategic objective for the business is to increase revenue
from specialist service lines and independent healthcare providers.
This has started well in 2017 with revenue from these sources
increasing by 47% to GBP0.4m. A number of new service lines are in
development stages.
Exceptional costs
The total costs of listing on the London Stock Exchange were
GBP2.5m, of which GBP0.8m were recognised in 2016 and GBP1.7m in
2017. Of these costs GBP0.2m was deducted from the share premium
account and GBP2.3m over the two years has been treated as
exceptional items on the income statement. These costs have been
added back in to calculate adjusted operating profit and adjusted
earnings per share.
In addition, part of the proceeds were used to repay bank debt,
and previously capitalised fees of GBP0.6m have been treated as
exceptional financing costs and have also been added back in to
calculate adjusted profit before tax and adjusted earnings per
share.
A further consequence of being a public company has been the
introduction of share based payment schemes as long-term incentives
for Directors. The costs of these, in administration expenses, were
GBP0.04m for the period.
Earnings per share
Adjusted earnings per share increased by 41% to 3.14p,
reflecting the growth in the business and the altered capital
structure post listing.
Cash flow and net debt
The cash inflow from operating activities was lower than the
equivalent period in 2016 at GBP0.9m (2016: GBP2.6m) due to IPO
related costs. Excluding exceptional items, the EBITDA cash
conversion ratio of 61% is comparable with last year's 67% for the
equivalent period. This number is historically lower in the first
half of the year than the second half due to working capital
movement.
After raising GBP15m in primary funds on listing, Medica repaid
bank debt and loan notes totalling GBP15.7m.
Net debt as at 30 June 2017 was GBP8.5m, compared to GBP24.6m as
at 30 June 2016 and GBP22.0m as at 31 December 2016.
Fixed asset investment
The most significant purchase in the period to 30 June 2017 was
the renewal of Medica's PACS (Picture Archiving and Communications
System) for five years, which had a cost of GBP0.7m. Other
expenditure was largely expansionary costs of radiologist equipment
and client infrastructure.
Expenditure on fixed assets and software is higher than normal
in the first half of the year as a result of the PACS renewal and
will be much lower in the second half of the year.
Recruitment
Medica increased its number of contracted radiologists by 19 net
in the period to 267 as at 30 June 2017. The comparative figure for
the first six months of 2016 is 24. As at 18 September the number
was 291 and the second half of the year is expected to be stronger
than the first. The Board expect the total to be more than 300 by
the end of the year.
Recruitment and retention of radiologists is key to business
growth and is core to Medica's strategy. In broader terms,
increasing capacity is more than numbers of radiologists and the
strategy includes obtaining greater commitment from existing
radiologists. A good example is the appointment of Medica's first
full time radiologist in June.
People
Medica's employees remain core to the quality of the service
offering to clients and we will continue to recruit high calibre
individuals as we grow.
We would like to thank our employees for their hard work,
enthusiasm and dedication through a successful period of growth and
change. This includes our former Chief Operating Officer, Martin
Wells, who left the Company in August 2017 to pursue other
interests. We are pleased to welcome Sarah Burns as Medica's Chief
Operating Officer. We would also like to thank our shareholders for
their ongoing support.
Forward looking statements
Certain statements in this interim report are forward looking.
Although the Board believes that the expectations reflected in
these forward-looking statements are reasonable, it can give no
assurance that these expectations will prove to have been correct.
Because these statements involve risks and uncertainties, actual
results may differ materially from those expressed or implied by
these forward-looking statements.
Principal risks and uncertainties
The principal risks and uncertainties that could have a material
impact on the Group's performance together with the mitigation
strategies adopted have been reviewed and have not changed
significantly from those set out on pages 20 to 21 of the Strategic
Report included in the Groups 2016 Annual Report and Financial
Statements.
These risks and uncertainties arise from:
-- Retaining and growing reporting capacity
-- Quality deficiencies or other issues affecting the Group's accreditations
-- Failure to retain key management
-- Future changes in healthcare regulation
-- Reduction in demand for the Group's services from NHS Trusts
-- Failure to adequately protect its customers' patients' personal data
-- Significant competition and pricing pressure
-- Failure of information systems
John Graham, Chief Tony Lee, Chief
Executive Financial Officer
18 September 2017 18 September 2017
Condensed Consolidated Income Statement and Condensed
Consolidated statement of comprehensive income
For the six months ended 30 June 2017
Unaudited Unaudited Audited
6 Months 6 Months 12 months
ended ended ended
- 30 - 30 - 31
June June December
Note 2017 2016 2016
GBP000 GBP000 GBP000
Revenue 3 15,723 13,435 28,522
Cost of sales (8,079) (6,632) (14,313)
---------------- ---------------- ---------------
Gross profit 7,644 6,803 14,209
Administration expenses (3,791) (3,471) (6,993)
---------------- ---------------- ---------------
Operating profit 3,853 3,332 7,216
Other expenses - exceptional
items 4 (1,503) - (757)
---------------- ---------------- ---------------
Operating profit after exceptional
items 2,350 3,332 6,459
Finance income 5 5 10
Finance costs (483) (1,065) (2,181)
Exceptional items finance
costs 4 (582) - -
---------------- ---------------- ---------------
Net finance costs (1,060) (1,060) (2,171)
Profit before tax 1,290 2,272 4,288
Analysed as
Adjusted EBITDA 4,873 4,319 9,229
Share based payments (37) - -
Exceptional items 4 (1,503) - (757)
Exceptional finance costs (582) - -
Finance costs (483) (1,065) (2,181)
Finance income 5 5 10
Depreciation (387) (471) (883)
Amortisation (596) (516) (1,130)
---------------- ---------------- ---------------
Profit before tax 1,290 2,272 4,288
Income tax charge (510) (474) (971)
---------------- ---------------- ---------------
Profit attributable to equity
holders of the parent 780 1,798 3,317
================ ================ ===============
Statement of Comprehensive
Income
Profit for the period/ year 780 1,798 3,317
Other comprehensive income - - -
Total comprehensive profit for
the period/ year attributable
to owners of the parent 780 1,798 3,317
================ ================ ===============
Profit per share (basic and
diluted)
Basic profit per ordinary
share (pence) 5 0.73 1.80 3.32
Diluted profit per ordinary
share (pence) 5 0.73 1.80 3.32
Condensed Consolidated Balance Sheet
As at 30 June 2017
Unaudited Unaudited Audited
30 30 31 December
June June
2017 2016 2016
GBP000 GBP000 GBP000
Non-current assets
Goodwill 15,948 15,948 15,948
Other intangible assets 9,664 9,829 9,402
Property, plant and
equipment 2,064 1,954 1,835
--------- --------- -----------
27,676 27,731 27,185
Current assets
Trade and other receivables 7,440 5,814 6,073
Cash and cash equivalents 3,390 2,332 4,713
--------- --------- -----------
10,830 8,146 10,786
Current liabilities
Trade and other payables (3,188) (2,368) (3,283)
Borrowings - (1,286) (1,362)
Derivative financial
instruments (29) (67) (52)
--------- --------- -----------
(3,217) (3,721) (4,697)
Non-current Liabilities
Borrowings and other
financial liabilities (11,876) (25,635) (25,369)
Deferred tax (1,490) (1,731) (1,596)
(13,366) (27,366) (26,965)
Net Assets 21,923 4,790 6,309
========= ========= ===========
Equity
Share capital 222 146 146
Share premium 14,721 1,309 1,309
Retained profit 6,980 3,335 4,854
--------- --------- -----------
Total equity 21,923 4,790 6,309
========= ========= ===========
Condensed Consolidated Statement of Changes in Equity
As at 30 June 2017
Share Share Retained Total
Capital premium earnings Equity
GBP000 GBP000 GBP000 GBP000
At 1 January 2016 146 1,309 1,537 2,991
-------- -------- --------- -------
Profit and total comprehensive
income for the period - 1,798 1,799
At 30 June 2016 146 1,309 3,335 4,790
======== ======== ========= =======
Profit and total comprehensive
income for the period - 1,519 1,519
At 1 January 2017 146 1,309 4,854 6,309
======== ======== ========= =======
Cancellation of
share premium - (1,309) 1,309 -
Shares issued during
the year 76 14,924 - 15,000
Share issue costs - (203) - (203)
Equity settled share based
payments - - 37 37
Transactions with
owners 76 13,412 1,346 14,834
Profit and total comprehensive
income for the period - 780 780
At 30 June 2017 222 14,721 6,980 21,923
======== ======== ========= =======
Condensed Consolidated Cash Flow Statement
For the six months ended 30 June 2017
Unaudited Unaudited Audited
12 Months
6 Months 6 Months ended
ended ended 31
30 June 30 June December
2017 2016 2016
GBP000 GBP000 GBP000
Operating activities
Profit before tax 1,290 2,272 4,288
Adjustments for :
Depreciation 387 471 883
Amortisation 596 516 1,130
Share based payments 37 - -
Finance income (5) (5) (10)
Finance costs 1,065 1,065 2,211
Changes in:
(Increase) in trade and other receivables (1,367) (1,481) (1,740)
(Decrease) / increase in trade
and other payables (529) 67 949
Tax (paid) (604) (321) (924)
--------- --------- ---------
Cash inflow from operating activities 870 2,584 6,787
Investing activities
Purchase of property plant and
equipment (616) (496) (789)
Purchase of software intangibles (437) (251) (438)
Interest received 5 5 10
--------- --------- ---------
Cash outflow from investing activities (1,048) (742) (1,217)
Cash flows from financing activities
Proceeds from share issue 15,000 - -
Share issue costs (203) - -
Loan finance raised - 13,600 13,600
Repayment of borrowings (15,722) (14,802) (15,626)
Interest paid (220) (393) (916)
--------- --------- ---------
Net cash outflow from financing (1,145) (1,595) (2,942)
Net change in cash and cash equivalents (1,323) 247 2,628
========= ========= =========
Movement in net cash
Cash and cash equivalents, beginning
of period 4,713 2,085 2,085
(Decrease)/Increase in cash and
cash equivalents (1,323) 247 2,628
Cash and cash equivalents, end
of period 3,390 2,332 4,713
========= ========= =========
Condensed notes to the accounts
1. General Information
Medica Group PLC ("the Company") is incorporated in England and
Wales. The half-year results and condensed consolidated financial
statements for the six months ended 30 June 2017 (the interim
financial statements) comprise the results of the company and its
subsidiaries (together referred to as the Group).
The Directors of Medica Group PLC have assessed the current
financial position of the Group, along with future cash flow
requirements to determine if the Group has the financial resources
to continue as a going concern for a period of at least twelve
months from the approval of the interim financial statements. As a
result of this review the Directors of Medica Group PLC have
concluded that it is appropriate that Medica Group PLC be
considered a going concern. For this reason, they have adopted the
going concern basis in preparing the financial statements. The
financial statements do not include any adjustments that would
result in the going concern basis of preparation being
inappropriate.
A copy of the statutory accounts for the year ended 31 December
2016 has been delivered to the Registrar of Companies. The auditors
reported on those accounts: their 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.
The interim financial statements for the six months ended 30
June 2017 have been reviewed by Grant Thornton UK LLP but have not
been audited.
2. Accounting policies
Basis of preparation
The interim financial statements of Medica Group plc are
prepared in accordance with International Accounting Standard 34
"Interim Financial Reporting", the recognition and measurement
criteria of International Financial Reporting Standards (IFRS) as
adopted by the European Union and the disclosure requirements of
the Listing Rules. The interim financial statements do not include
all information required for full annual financial statements and
should be read in conjunction with the Annual Report and Financial
Statements for the year ended 31 December 2016.
Significant accounting policies
The accounting policies applied by the Group in this condensed
set of consolidated financial statements are consistent with those
applied by the Group in its consolidated financial statements for
the year ended 31 December 2016. In additional the accounting
policies used are consistent with those that the directors intend
to use in the Annual Report and Financial Statements for the year
ending 31 December 2017. Taxes on income in the interim period are
accrued using the tax rate that would be applicable to the expected
total annual earnings.
Adoption of new and revised standards
At the date of authorisation of these interim financial
statements, certain new standards, amendments and interpretations
to existing standards have been published by the IASB and adopted
by the EU but are not yet effective, and have not been adopted
early by the Group. Management anticipates that all of the relevant
pronouncements will be adopted in the Group's accounting policies
for the first period beginning after the effective date of the
pronouncement. Information on new standards, amendments and
interpretations that are expected to be relevant to the Group's
financial statements is provided below. Certain other new standards
and interpretations have been issued but are not expected to have a
material impact on the Group's financial statements.
-- IFRS 9 'Financial Instruments', effective 1 January 2018
-- IFRS 15 'Revenue from contracts with customers', effective date 1 January 2018
-- IFRS 16 'Leases', effective date 1 January 2019.
These standards are yet to be subject to a detailed review. IFRS
9 will impact both the measurement and disclosure of financial
instruments and IFRS 15 may have a limited impact on revenue
recognition and related disclosures. IFRS 16 will impact the
measurement and disclosure of lease liabilities, and the
liabilities shown on the Group's balance sheet.
Beyond this, it is not practicable to provide a reasonable
estimate of the effect of these standards until a detailed review
has been completed. A number of IFRS and IFRIC interpretations are
also currently in issue which are not relevant for the Group's
activities and which have not therefore been adopted in preparing
these financial statements.
3. Segment reporting
Management prepare and monitor financial information for the
Group's three primary service lines (Routine Cross-Sectional,
Routine Plain Film and NightHawk) on a regular basis. This
financial information is reviewed and used by the chief operational
decisions maker (considered to be the Chief Executive Officer) in
managing the operating activities of the Group. IFRS 8 sets out
certain thresholds in determining whether reportable operating
segments exist, and all of the three primary service lines exceed
these thresholds. However, IFRS 8 permits the aggregation of
operating segments where these services lines are similar in
nature, service delivery processes, types or classes of customers,
and regulatory factors. Management consider it is most appropriate
to aggregate the three service lines into one teleradiology
operating segment due to the similarities in respect of these
factors.
Medica Group PLC has identified only one geographic area, the
UK. As a result of this and there being only one operating segment
as described above, no analysis has been provided.
No customer accounted for more than 10% of the Group's
revenues.
The Group identified four revenue streams, NightHawk, Routine
Cross-Sectional, Routine Plain Film and other. The analysis of
revenue by each stream is detailed below.
Unaudited Unaudited Audited
12 Months
6 Months 6 Months ended
ended ended 31
30 June 30 June December
2017 2016 2016
NightHawk 7,683 6,477 13,536
Routine Cross-Sectional 5,830 4,730 10,508
Routine Plain Film 1,813 1,977 3,876
Other 397 251 602
15,723 13,435 28,522
========= ========= =========
4. Exceptional items
Unaudited Unaudited Audited
12 Months
6 Months 6 Months ended
ended ended 31
30 June 30 June December
2017 2016 2016
Costs incurred in respect of Initial
public offering 1,503 - 757
Capitalised debt fees
written off 582 - -
2,085 - 757
========= ========= =========
Exceptional items are items that are unusual because of their
size and incidence and which the Directors consider should be
separately disclosed to enable a full understanding of the Group's
results.
The above costs were incurred in respect of the company's
refinancing and listing on the stock exchange in March 2017.
Although some of the costs are allowable for corporation tax
purposes a large proportion of the costs are deemed capital in
nature and therefore are not allowable for tax purposes. The costs
of these exceptional items have been financed through the funds
raised through the offering and therefore are not expected to have
any negative impact upon the cash flow of the group.
5. Earnings per share
Both the basic and diluted profit per share have been calculated
using the profit after tax attributable to shareholders of Medica
Group PLC as the numerator. The calculation of the basic profit per
share is based on the profit attributable to ordinary shareholders
divided by the weighted average number of shares in issue during
the year.
Unaudited Unaudited Audited
12 Months
6 Months 6 Months ended
ended ended 31
30 June 30 June December
2017 2016 2016
GBP000 GBP000 GBP000
Profit for the year attributable
to ordinary shareholders 780 1,798 3,317
Exceptional items 1,503 - 757
Exceptional finance costs 582 - -
Amortisation of acquired intangibles 435 435 870
Refinance costs - - 39
Share based payments 37 - -
Adjusted profit for the period
attributable to ordinary shareholders 3,337 2,233 4,983
=========== =========== ===========
Weighted average number of ordinary
shares 106,200,125 100,000,002 100,000,002
Dilutive effect of share options 372,222 - -
----------- ----------- -----------
Weighted average number of ordinary
shares including dilutive 106,572,347 100,000,002 100,000,002
Basic profit per ordinary share
(pence) 0.73 1.80 3.32
=========== =========== ===========
Diluted profit per ordinary share
(pence) 0.73 1.80 3.32
=========== =========== ===========
Adjusted basic profit per ordinary
share (pence) 3.14 2.23 4.98
=========== =========== ===========
Adjusted diluted basic profit
per ordinary share (pence) 3.13 2.23 4.98
=========== =========== ===========
On 15th March 2017 the subdivision of the 1,455,000 ordinary
shares of GBP0.10 each was approved so that each ordinary share of
GBP0.10 each was sub-divided into 50 ordinary shares of 0.2p and by
way of a bonus issue the Company allotted 27,250,002 ordinary
shares of 0.2p each at nominal value to its existing shareholders
pro rata to their existing shareholdings. The weighted average
number of ordinary shares after these transactions amounted to
100,000,002 and in accordance with IAS33 the earnings per share
calculations have been retrospectively adjusted for the period
ended 30 June 2016 and year ended 31 December 2016.
6. Reconciliation of Non-IFRS Financial KPIs
The Group uses a number of key performance indicators to monitor
the performance of its business. This note reconciles these key
performance indicators to individual lines in the financial
statements.
6 Months 6 Months 12 Months
ended ended ended
30 30 31
June June December
2017 2016 2016
Reconciliation of Adjusted Operating
Profit GBP GBP GBP
Operating profit 3,853 3,332 7,216
Adjustments for :
Amortisation of acquired intangibles 435 435 870
Equity settled share based payments 37 - -
Refinance costs - - 39
Adjusted Operating profit 4,325 3,767 8,125
Adjusted Operating profit margin 27.5% 28.0% 28.5%
Reconciliation of Adjusted Profit
Before Tax
Profit for the year 780 1,798 3,317
Adjustments for :
Amortisation of acquired intangibles 435 435 870
Exceptional items 1,503 - 757
Exceptional finance costs 582 - -
Share based payments 37 - -
Refinance costs - - 39
Adjusted profit after tax 3,337 2,233 4,983
Income tax charge 510 474 971
-------- -------- ---------
Adjusted Profit before Tax 3,847 2,707 5,954
Reconciliation of Adjusted EBITDA
cash conversion percentage
Cash inflow from operating activities 870 2,584 6,787
Adjustments for :
Tax paid 604 321 924
Exceptional items 1,503 - 757
2,977 2,905 8,468
Adjusted EBITDA 4,873 4,319 9,229
Conversion rate 61% 67% 92%
Reconciliation of Net debt
Cash and equivalents 3,390 2,332 4,713
Borrowings due within one year - (1,286) (1,362)
Borrowings due after one year (11,876) (25,635) (25,369)
-------- -------- --------
Net Debt (8,486) (24,589) (22,018)
7. Related party Transactions
On 21 March 2017 payment was made to CBPE Nominees Limited, the
Group's ultimate controlling party immediately before admission to
the London Stock exchange, in the sum of GBP6,945,897 to repay the
loan notes in full. Interest charges of GBP178,000 have been
recognised in the consolidated statement of comprehensive
income.
Included in administrative costs are GBP21,000 (2016: GBP21,000)
in respect of fees payable to CBPE Nominees Limited for the
services of the Investor Director to the Group.
Statement of Directors' Responsibilities
The Directors confirm to the best of their knowledge that
(a) The interim condensed consolidated financial information has
been prepared in accordance with IAS 34 as adopted by the European
Union; and
(b) The Interim Report includes a fair view of the information
as required by:
-- DTR 4.2.7R of the Disclosure Guidance and Transparency Rules,
being an indication of important events that have occurred during
the first half of 2017 and their impact on the interim condensed
consolidated financial information; and a description of the
principal risks and uncertainties for the remaining second half of
the year; and
-- DTR4.2.8R of the Disclosure Guidance and Transparency Rules,
being related party transactions that have taken place in the first
half of 2017 and any material changes in the related party
transactions described in the last Annual Report.
The Directors of Medica Group PLC and their functions are listed
below:
Roy Davis - Chairman
John Graham - Chief Executive
Stephen Davies - Medical Director
Tony Lee - Chief Financial Officer
Steve Whittern - Senior Non-Executive Director
Anand Jain - Non-Executive Director
Michael Bewick - Non-Executive Director
By order of the Board
Tony Lee
Chief Financial Officer
18 September 2017
Independent review report to the members of Medica Group plc
Introduction
We have reviewed the condensed set of financial statements in
the half-yearly financial report of Medica Group plc for the six
months ended 30 June 2017 which comprises the Condensed
Consolidated Income Statement, the Condensed Consolidated Statement
of Comprehensive Income, the Condensed Consolidated Balance Sheet,
the Condensed Consolidated Statement of Changes in Equity, the
Condensed Consolidated Cash Flow Statement and the related notes.
We have read the other information contained in the half yearly
financial report which comprises only the Chairman's Statement and
the Financial and Business Review and considered whether it
contains any apparent misstatements or material inconsistencies
with the information in the condensed set of financial
statements.
This report is made solely to the company's members, as a body,
in accordance with International Standard on Review Engagements (UK
and Ireland) 2410, 'Review of Interim Financial Information
performed by the Independent Auditor of the Entity'. Our review
work has been undertaken so that we might state to the company's
members those matters we are required to state to them in an
independent review report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility
to anyone other than the company and the company's members as a
body, for our review work, for this report, or for the conclusion
we have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the Disclosure and Transparency Rules of the United Kingdom's
Financial Conduct Authority.
As disclosed in note 2, the annual financial statements of the
group are prepared in accordance with International Financial
Reporting Standards as adopted by the European Union. The condensed
set of financial statements included in this half-yearly financial
report has been prepared in accordance with International
Accounting Standard 34, 'Interim Financial Reporting', as adopted
by the European Union.
Our responsibility
Our responsibility is to express a conclusion on the condensed
set of financial statements in the half-yearly financial report
based on our review.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, 'Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity'. A review of interim financial information consists
of making enquiries, primarily of persons responsible for financial
and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing
(UK) and consequently does not enable us to obtain assurance that
we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit
opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 30
June 2017 is not prepared, in all material respects, in accordance
with International Accounting Standard 34, 'Interim Financial
Reporting', as adopted by the European Union and the Disclosure and
Transparency Rules of the United Kingdom's Financial Conduct
Authority.
GRANT THORNTON UK LLP
STATUTORY AUDITOR, CHARTERED ACCOUNTANTS
Crawley
18 September 2017
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SFMFMIFWSESU
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