TIDMOMG
RNS Number : 3029U
Oxford Metrics PLC
02 December 2021
2 December 2021
Oxford Metrics plc
("Oxford Metrics", the "Company" or the "Group")
Preliminary Results for the financial year ended 30 September
2021
- Strong full year performance and recovery following pandemic
impacted trading -
- Updated 5-year plan to deliver further shareholder value -
- Positive outlook with both divisions experiencing a strong
start in the new financial year -
Oxford Metrics plc (LSE: OMG), the smart sensing software
company servicing, life sciences, entertainment and engineering
markets, announces preliminary results for the financial year ended
30 September 2021.
FY21 % Change FY20
Revenue GBP35.6m +17.6% GBP30.3m
-------- -------- ---------
Annual Recurring Revenue GBP7.4m +8.8% GBP6.8m
-------- -------- ---------
Adjusted Profit Before Tax* GBP4.8m +89.4% GBP2.6m
-------- -------- ---------
Adjusted* Basic Earnings per
Share 3.59p +75.1% 2.05p
-------- -------- ---------
Ordinary Dividend per Share 2.00p +11.1% 1.80p
-------- -------- ---------
Statutory Profit before Tax GBP3.2m +103.6% GBP1.6m
-------- -------- ---------
Statutory Basic Earnings per
Share 2.32p +81.3% 1.28p
-------- -------- ---------
Net Cash GBP23.0m +53.7% GBP14.9m
-------- -------- ---------
Operating Cashflow GBP14.5m +105.9% GBP7.0m**
-------- -------- ---------
* Profit Before Tax before Group recharges adjusted for
share-based payments, amortisation and impairment of intangibles
arising on acquisition, impairment of Pimloc investment and
exceptional costs.
** Restated
Financial Highlights
-- Headline revenue of GBP35.6m (FY20: GBP30.3m), up 17.6% (up 19.9%
on a constant currency basis)
-- Improved quality of earnings, with Annual Recurring Revenue ('ARR')
of GBP7.4m (FY20: GBP6.8m) with new ARR additions of GBP1.3m (FY20:
GBP1.0m)
-- Adjusted Profit Before Tax* at GBP4.8m (FY20: GBP2.6m)
-- Continued cash generation, with GBP23.0m in net cash (FY20: GBP14.9m)
and operating cashflow of GBP14.5m (FY20: GBP7.0m - Restated)
-- Board proposes increasing our final dividend to 2.00p per share
(FY20: 1.80p) this year
Operational Highlights
Vicon delivers impressive revenue growth and profitability
-- Vicon's growth restored in FY21 reporting an increase in revenues
of 21.1% to GBP27.6m (FY20: GBP22.8m), gross margin of 72.6% (FY20:
73.6%) reflecting a slightly higher prevalence of larger deals
during the year.
-- Revenue growth underpinned by strong Entertainment segment driven,
up 76.5%.
-- The Contemplas acquisition, completed in August 2021, has brought
benefits to Vicon including adding a video-based movement analysis
to our offering and contributed revenues of GBP0.2m in the last
month of the financial year and a small profit.
Yotta continued growth and a full year of profitability
-- Another major milestone achieved: Full year of Adjusted profits
delivered following transition to SaaS model
-- Digital transformation in public sector continues to improve quality
of earnings with our highest level of ARR, up 8.8% to GBP7.4m
at year-end adding GBP1.3m (FY20: GBP1.0m) to the ARR base during
the year.
-- Continuing to invest in our products: Alloy added finance and
accounting, Street Manager and enhanced reporting functionality
while Horizons has benefitted from collaboration with new partner
Vaisala.
Outlook and Guidance
-- Both divisions have experienced a strong start to the new fiscal
year with key demand metrics pointing to a positive outlook.
-- Vicon's current revenue pipeline for the first half is at least
20% ahead of this time last year and the business currently holds
an unprecedented level of orders in hand of GBP5.9m.
-- As in many industries, Vicon continues to experience some short-term
supply chain challenges arising from the well-publicised global
semiconductor shortage
-- I nvestment in the year ahead to augment our capabilities to sense,
analyse and apply our technology, increased by GBP2.3m on an annualised
basis.
-- Yotta has a strong ARR sales pipeline for the full year, consistent
with adding at least another GBP1.2m gross additions to ARR during
the financial year.
-- The Group starts the year in a strong financial position to invest
in its future and continues to evaluate acquisition opportunities
that will accelerate our strategy.
-- The Board look forward to an exciting year ahead that will be
the first step in our new five-year plan delivering further shareholder
value.
Commenting on the results Nick Bolton, Chief Executive said:
"Oxford Metrics is pleased to report a return to form with a
strong full year performance and recovery following last year's
pandemic impacted trading, with all the Group's key financial
metrics having improved.
The pandemic demonstrated the Group's resilience but has also
accelerated market drivers in both Vicon and Yotta. Vicon's growth
has been restored driven by the buoyant video games sector and the
demand for Virtual Production. Yotta continues to benefit from the
ongoing need to digitally transform assets, reporting its highest
level of ARR.
During the second half of the year, we gradually saw
Location-based Entertainment partners restart their facilities and,
in some cases, their rollouts.
As we move into the next financial year both divisions have
experienced a strong start with key demand metrics pointing to a
positive outlook. Vicon's current revenue pipeline for the first
half is at least 20% ahead of this time last year and has an
unprecedented level of orders in hand but, like many industries,
continues to experience some short-term supply chain challenges.
Yotta has a strong ARR sale pipeline for the full year with ARR
growth anticipated. The Board is looking forward to an exciting
year and the first step in our new five-year plan."
For further information please contact :
Oxford Metrics +44 (0) 1865 261860
Nick Bolton, CEO
David Deacon, CFO
Numis Securities Limited +44 (0)20 7260 1000
Simon Willis / Hugo Rubinstein
FTI Consulting +44 (0) 20 3727 1000
Matt Dixon / Jamille Smith / Greg Hynes
About Oxford Metrics
Oxford Metrics develops software that enables the interface
between the real world and its virtual twin. Our smart sensing
software helps over 10,000 customers in more than 70 countries,
including all of the world's top 10 games companies and all of the
top 20 universities worldwide. Founded in 1984, we started our
journey in healthcare, expanded into entertainment, winning an
OSCAR(R) and an Emmy(R), then moved into defence and engineering.
We have a track record of creating value by incubating, growing and
then augmenting through acquisition, unique technology
businesses.
The Group trades through two market-leading divisions: Vicon and
Yotta. Vicon is a world leader in motion measurement analysis to
thousands of customers worldwide, including Guy's Hospital,
Industrial Light & Magic, MIT and NASA. Yotta's cloud-based
infrastructure asset management software enables central and local
government agencies and other infrastructure owners to digitally
manage their assets. Yotta has a large number of high-profile
clients including VicRoads in Australia , Auckland Motorway System
in New Zealand, and, in the UK, National Highways and over 160
local authorities.
The Group is headquartered in Oxford with offices in Leamington
Spa, Gloucester, California, Colorado, and Auckland. Since 2001,
Oxford Metrics (LSE: OMG), has been a quoted company listed on AIM,
a market operated by the London Stock Exchange.
For more information about Oxford Metrics, visit
www.oxfordmetrics.com .
Chairman's Statement
We are pleased to report a strong full year performance in
2020/21 and a return to form following last year's
pandemic-impacted trading. The business has demonstrated its
resilience during the period and signs of accelerating market
trends commented on last year are now being realised. Furthermore,
we have emerged from the challenges over the past 18 months with an
even stronger financial platform to fund organic growth and
expedite potential acquisition opportunities.
Without exception, the key financial metrics of the business
have improved for the 12 months to 30 September 2021 with the Group
reporting revenue of GBP35.6m (FY20: GBP30.3m), a statutory PBT of
GBP3.2m (FY20: GBP1.6m), an Adjusted PBT* of GBP4.8m (FY20:
GBP2.6m), cash generated from operating activities GBP14.5m (FY20:
GBP7.0m - Restated) and a cash position of GBP23.0m (FY20:
GBP14.9m). We also continued to enhance the quality of our earnings
by increasing our Annual Recurring Revenue ('ARR') to GBP7.4m
(FY20: GBP6.8m).
In the light of the financial performance and confidence in the
ongoing resilience of the business, the Board proposes increasing
our final dividend to 2.00p per share (FY20 Final Dividend: 1.80p)
this year. Our dividend policy remains to make the pay-out
progressive with the aim of maintaining an average dividend cover
of approximately two-times Adjusted* Earnings per Share.
Having successfully navigated a challenging period, our focus is
now firmly on the future. We are embarking on our growth plan for
the next five years designed to augment our capabilities to sense,
analyse and apply our technology and increase our addressable
markets with the goal of creating a substantially larger business
and shareholder value.
Board
On October 1 2021, we appointed Paul Taylor to replace Adrian
Carey as Chair of the Audit Committee. Paul brings over 20 years of
boardroom experience as an Executive and Non-Executive Director,
and throughout his career has been involved with growth-oriented
technology businesses. Paul spent a large part of his executive
career with AVEVA Group plc, where as CFO he was part of the team
that delivered consistently high levels of growth in revenue and
profitability both organically and through acquisition. Paul has
also served on the Board of a number of technology businesses in a
Non-Executive capacity supporting Executive teams in delivering
strong stakeholder returns. I welcome Paul to our Board and look
forward to working with him and the rest of Board as we further
grow the business.
Furthermore, following Paul Taylor assuming Audit Committee
Chair responsibilities, Adrian Carey will stand down as a
Non-Executive Director and Senior Independent Director at the
company's next AGM, expected to be held in February 2022. During
Adrian's near 10 years of continuous service to the group, he has
been instrumental in guiding the business as we grew into the
strong position we stand today. I would like to take this
opportunity on behalf of the Board to thank Adrian for his insight
and valuable contributions, and wish him well in his future
endeavours.
Lastly, I want to thank the stakeholders in our business for all
their contributions over the past year - our outstanding team in
our offices worldwide, our shareholders, our partners and most
importantly our customers.
Roger Parry
Chair
* Profit Before Tax before Group recharges adjusted for
share-based payments, amortisation and impairment of intangibles
arising on acquisition, impairment of Pimloc investment and
exceptional costs.
CEO STATEMENT
To use a meteorological metaphor, we have seen all types of
weather over this past 12 months. We started the year with the
winter of on-going, multiple lockdowns and we finished it in the
sunshine of greater than pre-pandemic levels of demand, albeit with
a squeezed supply chain. As you can see from the headline results,
it was a year of clear trading progress and we now stand on our
strongest ever platform. We have over 10,000 customers worldwide in
over 70 different countries, including all 10 of the world's top 10
games companies and all of the top 20 universities worldwide. We
even have around half the UK street lighting assets managed using
our software. It was also a year where the macro changes we have
been tracking for several years started to accelerate and it is
this acceleration that indicates the path we must take to drive
further future growth through our new five-year plan.
STRATEGIC REVIEW - OUR NEW FIVE-YEAR PLAN
Ever since 1984, Oxford Metrics has been enabling the interface
between the real world and its virtual twin. It was in that year we
introduced our first motion capture system and we have been
providing a bridge between the physical and digital world ever
since.
We started our journey in healthcare, we expanded into
entertainment, winning an OSCAR(R) and an Emmy(R), then we moved
into defence and engineering. We have a track record of creating
value by incubating, growing and then augmenting through
acquisition, unique technology businesses.
Accelerated Augmentation
As we emerge from the pandemic, something fundamental is
changing in our markets and in our opportunity. We are seeing an
acceleration of the Augmented Age - an era where machines and
humans partner to achieve what neither can do alone. We were
already seeing this in many of the markets we serve, including
robotics, healthcare, sports and entertainment - but now it's been
brought forward by the pandemic. Look at the faster adoption of
tele-medicine, remote management, and virtual production.
For this augmented partnership between human and machine to
work, we need technologies which have the ability to perceive us
and our surroundings. They must be able to capture and understand
every dimension of our world in real-time - humans, objects,
movements, environments. This requires smart sensing systems, where
cameras and other sensors are deeply coupled with powerful software
to enable machines to transparently enhance our lives.
No longer will it be sufficient for a company's solution to just
stop at the image or sensed data. Integrated smart sensing
solutions, such as the ones we offer, look after the full life
cycle of the data - sense, analyse, apply. From imagery to insight;
from pixel to purpose; from sensing to sense-making, we aim to lead
this important and expanding category in those end markets we
already understand well.
The expansion of this market opportunity is being driven by two
recent and still on-going underlying technology trends. Firstly,
improvements in sensing capability - lower cost, higher resolution,
better imagers, which can be readily combined with other also
rapidly improving sensors (e.g. inertial, LIDAR and environmental
sensors). Secondly, improvements in processing capability - both in
terms of hardware (GPUs and now Neural Processing Units and other
forms of specialised processors) and software (especially in
Machine Learning).
Rise of Smart Sensing
These improvements mean smart sensing can be applied to a much
wider set of problems and markets, and this represents a
significantly expanded opportunity for Oxford Metrics. But one
which requires us to both broaden and adapt our own offering to
access the significantly larger marketplace than we operate in
today.
We cannot serve all these end markets directly because we lack
the necessary whole products, channels and other resources to be
successful. Where we can generate significant value, however, is in
providing both the tools for the R&D departments in these
markets and then go on to embed our technology in those firms who
do hold the requisite end-market elements and thus gain indirect
access to this profit pool.
Three growth levers
To achieve this vision, capture the opportunity and drive growth
over the life of this five-year plan, we will focus on three key
initiatives:
1. Extend the sensing capabilities our integrated smart sensing
systems through R&D, M&A and fostering key supplier
partnerships. Currently, our solutions utilise a wide range of
sensors from environmental monitors to force plates, from inertial
sensors to cameras - some we own and some we just integrate with.
These existing sensing mechanisms can be improved, and we can also
add other sensing mechanisms to broaden the applicability of our
integrated solutions.
2. Enhance the analysis we can undertake to broaden the range of
applications to which our systems can be applied. Our most recent
acquisition, Contemplas, competed in August 2021, and their
experience with tracking and measuring from video, is a great
example of this.
3. Embed our Intellectual Property (IP) in other firms'
solutions by opening up our technology through R&D, M&A and
investing in dedicated embedding sales and support resources. Here
we will expand the ability to integrate our sensing and analysis IP
to specific application domains with the aim to provide a stream of
visible licensing revenues. We already have 13 partners who
integrate our technologies as part of their end-market solutions;
for example, in Pavement Management Services PTY Ltd at Yotta and
in the Location-based Entertainment (LBE) market at Vicon.
Given the importance of M&A to drive growth, it is worth
describing the strict criteria we employ to identify ideal targets.
We look for IP-rich, hard-to-replicate technology companies with
attractive actual or potential cashflow metrics, good-to-high
revenue visibility or a dominant position in a niche market, proven
market acceptance of their technology, and able management teams
who share our cultural values. We do not need all these things at
the point of acquisition but, where this is not possible, a pathway
to how they can be achieved must be clear.
Our aim is to identify latent value in asset, buy at a fair
price and then improve performance through clear strategy,
technology transfer and careful investment in R&D. Sometimes we
will integrate the firm into one of our existing subsidiaries and
sometimes the acquired company will stand as a separate division.
We seek acquisitions both in public and private markets. We employ
people directly in deal origination, assessment and execution, and
we leverage our strong network of advisors.
Aims
Through these growth mechanisms we have two specific financial
aims. Firstly, we seek to increase revenues to 2.5 times their
2020/21 levels by the end of the five-year period. Secondly,
although some of the organic investment we need to make will reduce
Return on Sales ('ROS') in the early years of the plan we expect
this investment, amplified through M&A activity, to return the
group to our historic 15% adjusted profit before tax by the end of
the plan. By the end of this plan, we will be a bigger business
both in terms of revenues and profits.
OPERATIONAL REVIEW
2020/21 represented a return to form with both Yotta and Vicon
reporting much improved performances despite residual challenges
arising from the COVID-19 pandemic.
Motion Measurement Division - Vicon
KPI Revenue PBT Adjusted PBT*
FY21 FY20 FY21 FY20 FY21 FY20
--------- --------- -------- -------- -------- --------
Motion measurement GBP27.6m GBP22.8m GBP3.5m GBP2.7m GBP6.8m GBP4.8m
--------- --------- -------- -------- -------- --------
Vicon's growth trajectory was restored in FY21 reporting an
increase in revenues of 21.1% to GBP27.6m (FY20: GBP22.8m). This
growth was underpinned by a buoyant Entertainment segment, up 76.5%
and Engineering, up 39.2%. The Life Sciences segment declined by
14.9%, so still relatively subdued post pandemic and as expected,
Location Based Entertainment ('LBE') also declined by 31.9% due to
the pandemic but towards the end of the financial year signs of a
recovery had commenced.
Gross margin on reported revenue was 72.6% (FY20: 73.6%)
reflecting a slightly higher prevalence of larger deals during the
year, partly driven by the continuing adoption of virtual
production. The overall cost base increased in line with activity
levels which gave rise to an overall increase in Vicon reported
Adjusted PBT* of GBP6.8m (FY20: GBP4.8m). The above performance
includes recently acquired Contemplas GmbH which contributed
revenues of GBP0.2m in the last two months of the financial year
and a small profit.
The Contemplas acquisition, completed in August 2021, brings a
number of benefits to Vicon including adding a video-based movement
analysis to our offering, bringing a dominant position in the niche
market of swimming analysis and strengthening our presence in
Europe. Complementing Vicon's strong heritage and leadership
position in motion measurement, the acquisition also brings
valuable IP which over time, will assist with Vicon's broader
product development plans.
Entertainment's particularly strong year was driven by a buoyant
video games sector and the adoption of Virtual Production by
several large production houses. Virtual Production is a digitally
led way of working, merging real and virtual worlds, which
incorporates a range of techniques and innovations that have been
developed across the past 20 years. This includes motion capture
solutions pioneered by Vicon, combined with cutting edge visual
effects techniques and game engine technology, utilising tools such
as LED screens and high-resolution digital film cameras. The power
of this approach is when these techniques are used in concert.
Crucially, it blends the filming and post-production stages.
Instead of shooting against the classic green screen and then
waiting to see their vision come to life, directors can now see
digital characters, effects, and environments in real-time,
in-camera and on set. To respond to this clear market need, Vicon
introduced Sh gun 1.6 during the year with additional features
targeted specifically to address the needs of high-end Virtual
Production. These include a low latency object tracker, the ability
to calibrate specific cameras and exportable lens maps. During the
period Vicon also closed a deal with Dimension Studios, a leading
virtual production studio, to provide 56 of Vicon's Vantage cameras
and Vicon's Sh gun software to enable Dimension Studio's
ground-breaking work, including with leading visual effects company
DNEG for several high-profile virtual production projects.
All-in-all Virtual Production added GBP1.7m (FY20: GBP1.3m) in
revenues during the year and represents another exciting growth
opportunity for the business.
Through the second half of the year, we gradually saw
Location-based Entertainment (LBE) partners restart their
facilities and, in some cases, their rollouts. We now have 8LBE
partners globally, offering a wide array of unique entertainment
experiences. We remain confident that once momentum has been
restored in this market it will represent a significant revenue
growth opportunity going forward.
Asset Management Division - Yotta
KPI Revenue PBT Adjusted PBT*
FY21 FY20 FY21 FY20 FY21 FY20
-------- -------- ---------- ---------- -------- ----------
Asset Management GBP8.1m GBP7.5m (GBP0.4m) (GBP1.3m) GBP0.8m (GBP0.1m)
-------- -------- ---------- ---------- -------- ----------
Our Asset Management division, Yotta, reported its highest level
of ARR of GBP7.4m on 30 September 2021 (30 September 2020:
GBP6.8m). Yotta achieved gross additions to the ARR base of GBP1.3m
(FY20: GBP1.0m) during the year so continued to benefit from
ongoing Digital Transformation initiatives. Customer retention
remained largely unchanged at 90.1% (FY20: 91.7%).
Reported headline revenue increased by 7.0% to GBP8.1m (FY20:
GBP7.5m) and the division reported an Adjusted PBT* of GBP0.8m
(FY20 Loss: GBP0.1m) so delivering a full year of profitability
which, after a period of investment and losses, represents a major
milestone.
The growth in ARR driven by digital transformation led to
notable Alloy wins at Derbyshire, English Heritage, SSE Devon,
London Borough of Newham, London Borough of Havering, Walsall,
Calderdale, Northumberland and Ubico (West Oxfordshire). Revenue
recognition was increased by a host of go-lives including National
Highways, London Borough of Hackney, Chorley, Bury, North Somerset,
Huntingdonshire, Bristol Waste, Glasgow, West Lancashire and
Hillingdon. Our customers clearly appreciate Alloy's capability to
expand into new areas with one system and play a role in the wider
system ecosystem.
We continued to invest in product development. Alloy added
finance and accounting, Street Manager compatibility and enhanced
reporting functionality and Horizons now includes emissions
monitoring functionality. Horizons also benefitted from
collaboration with our new partner Vaisala, (a Finnish company that
develops, manufactures and markets products and services for
environmental and industrial measurement), which allows the user to
consume data from Vaisala's mobile phone-based surveying
application to analyse asset condition. This ability was
instrumental in the selection of Horizons by the aforementioned
Northumberland, Calderdale and Brent customers.
CURRENT TRADING AND OUTLOOK
Both divisions have experienced a strong start to the new fiscal
year with key demand metrics pointing to a positive outlook.
Turning first to Vicon, they start the new financial year with a
revenue pipeline for the first half which is at least 20% ahead of
this time last year and includes unprecedented level of orders in
hand of GBP5.9m. However, as in many industries, Vicon continues to
experience some short-term supply chain challenges arising from the
well-publicised global semiconductor shortage. Whilst there has
been some improvement in recent months the Board believe revenues
in the first half may be affected. We remain well prepared to meet
and manage this industry-wide challenge and anticipate that any
impact will result in revenue being delayed into the second half of
the year rather than being lost. Overall, the fundamentals at Vicon
remain positive and they remain well placed to capitalise on the
substantial market opportunity in the year ahead. As part of the
new five-year strategic plan, Vicon will also be increasing
investment in the year ahead, to augment our capabilities to sense,
analyse and apply our technology, by GBP2.3m on an annualised basis
going forward.
Yotta has a strong ARR sales pipeline for the full year,
consistent with adding at least another GBP1.2m gross additions to
ARR during the financial year. With this anticipated growth in ARR
and a stable cost base, Yotta can look forward to another full year
of profitability.
The Group starts the year in good financial health and in a
strong position to invest in its future and expedite acquisition
opportunities that will accelerate our strategy. The board look
forward to an exciting year ahead that will be the first step in
our new five-year plan delivering further shareholder value.
Nick Bolton
CEO
FINANCIAL REVIEW
Income Statement
The Group reported revenue of GBP35.6m (FY20: GBP30.3m)
representing a headline increase of 17.6%, and on a constant FX
basis the increase was 19.9%. From a geographical perspective,
Vicon USA, which had suffered the most during the pandemic,
recorded a headline year-on-year improvement of 11.7%, on a
constant FX basis the improvement was 19.3%.
Gross Profit margin improved to 70.7% (FY20: 69.0%), reflecting
a slight change in the mix of revenue. In real terms Gross Profit
improved year on year by GBP4.3m to GBP25.2m.
Reviewing the cost base within the Income Statement:
-- Sales, Support and Marketing costs increased by GBP0.5m which
was largely due to marketing and operational activity returning
to near normal levels together with additional sales commissions
arising from higher revenues.
-- Research & Development expensed through the Income Statement was
GBP5.0m (FY20: GBP4.2m). The overall increase was due to the R&D
amortisation and impairment charge of GBP2.2m (FY20: GBP1.8m).
The continual investment and innovation in product and services
is necessary to maintain the Group's competitive position which
included a number of the new products and services released during
the financial year, some of which are described in the CEO review.
-- Administration expenses increased by GBP1.3m which was largely
due to the impairment of the IMeasureU acquired intangible by
GBP1.0m and acquisition costs relating to Contemplas of GBP0.1m.
Adjusted PBT* of GBP4.8m (FY20: GBP2.6m) has been determined
after adding back to the Statutory PBT GBP3.2m (FY20: GBP1.6m)
non-cash items such as amortisation and impairment of acquired
intangibles, share option charge, impairment of investment in
Pimloc and non-recurring exceptional items which this year included
M&A costs of GBP0.1m. A full reconciliation is available in
note 7.
Acquisition of Contemplas GmbH
The acquisition contributed revenues of GBP0.2m in the final
month of the financial year and a small profit.
In accordance with IFRS 3 any future earn out payments will be
recognised in the Income Statement as deemed remuneration given
certain conditions associated with the acquisition. The amount
recognised as consideration in excess of the fair value of net
assets acquired has been attributed to software IP.
Statement of Financial Position
Goodwill and intangibles
The increase this year includes the acquisition of Contemplas
GmbH Acquired Intangibles of GBP1.9m. The remainder of the increase
represents the net effect of capitalised R&D of GBP2.8m (FY20:
GBP2.5m), amortisation and impairment of development costs GBP2.2m
(FY20: GBP1.8m) and the amortisation and impairment of acquired
intangibles of GBP1.5m (FY20: GBP0.6m) including the partial
impairment of the IMeasureU acquired intangible.
Property, plant and equipment
A small decline is reported to GBP1.8m (FY20: GBP1.9m).
Additions, including Contemplas, were GBP0.3m (FY20: GBP0.3m)
during the year and the depreciation charge was GBP0.5m (FY20:
GBP0.6m).
Right of use assets (IFRS16)
Additions of GBP0.3m and an amortisation of GBP0.5m resulted in
a net decline to GBP2.0m (FY20: GBP2.2m).
Investments
The investment of GBP0.2m relates to minority interest in Trensl
Inc. which provides training VR solutions for the military and
healthcare (rehabilitation). The investment comes back-to-back with
an exclusive Supply Agreement to provide all systems. The
year-on-year change relates to Contemplas which is now a 100% owned
subsidiary.
Inventories
The inventory position at the end of the financial year was
GBP2.5m (FY20: GBP3.4m). Overall, inventory levels have reduced due
to a combination of high demand during the year and slower
replenishment due to current supply chain challenges.
Trade and other receivables
At the year-end trade and other receivables decreased to GBP6.1m
(FY20: GBP9.2m). The overall decrease is largely due to lower Trade
receivables of GBP4.6m (FY20: GBP7.7m) reflecting a revenue
performance this year that was less weighted towards the end of the
financial year..
Current liabilities
The year-on-year increase in trade and other payables is
accounted for by an increase in trade payables at the year-end to
GBP2.5m (FY20: GBP2.0m), higher accruals GBP2.9m (FY20: GBP1.6m)
and an increase in Contract liabilities to GBP6.6m (FY20: GBP5.2m)
which reflects ARR growth. These increases were offset by the
withdrawal of VAT Covid payment relief (FY20: GBP0.8m) not
available in FY21.
The lease liabilities balance reported at GBP0.6m (FY20:
GBP0.4m) represents the value of lease payments due within one year
relating to right of use assets.
Non-current liabilities
The GBP0.3m increase in Other Liabilities is due to contract
liabilities.
The lease liabilities balance reported of GBP1.6m (FY20:
GBP1.9m) represents the value of lease payments due greater than
one year relating to right of use assets.
Statement of cashflows
The Group finished the year with cash of GBP23.0m (FY20:
GBP14.9m).
Cash generated from operating activities was GBP14.5m (FY20:
GBP7.0m - Restated) which included a working capital inflow arising
from a reduction in inventory of GBP1.1m (FY20: GBP0.2m increase),
a decrease in accounts receivables of GBP3.1m (FY20: GBP2.2m) and
an increase in payables of GBP2.2m (FY20: GBP0.2m decrease).
The deployment of this cash included continued investment in
development giving rise to a purchase of intangibles of GBP2.8m
(FY20: 2.5m), consideration paid for Contemplas of GBP1.1m and
payment of dividends of GBP2.3m (FY20: GBP2.3m)
Tax
The Group tax charge this year was GBP0.3m (FY20: GBP0.0m). This
increase for the most part is due to improved overseas trading. The
level of Group R&D activities in the UK where the marginal rate
of tax is 19% (FY20: 19%) continues to have a beneficial effect on
the level of corporation tax payable in the UK given the reliefs
available.
The deferred tax asset increased to GBP1.9m (FY20: GBP1.0m)
largely due to an increase in unrelieved losses and an increase in
the UK tax rate to 25% from 1(st) April 2023. The deferred tax
liability increased to GBP3.1m (FY20: GBP2.0m) largely due to the
Contemplas acquisition and the aforementioned increase in UK tax
rate.
David Deacon
CFO
* Profit Before Tax before Group recharges adjusted for
share-based payments, amortisation and impairment of intangibles
arising on acquisition, impairment of Pimloc investment and
exceptional costs.
consolidated INCOME statement
for the year ended 30 september 2021
All amounts relate to continuing operations 2021 2020
Note GBP'000 GBP'000
----------------------------------------------------- ---- -------- -------
Revenue 3 35,627 30,298
Cost of sales (10,442) (9,400)
----------------------------------------------------- ---- -------- -------
Gross profit 25,185 20,898
Sales, support and marketing costs (7,806) (7,341)
Research and development costs (4,951) (4,213)
Administrative expenses (9,105) (7,813)
Other operating income - 163
----------------------------------------------------- ---- -------- -------
Operating profit 3,323 1,694
Finance income 4 20
Finance expense (106) (103)
Share of post-tax loss of equity accounted associate - (29)
----------------------------------------------------- ---- -------- -------
Profit before taxation 3,5 3,221 1,582
Taxation 7 (286) 22
----------------------------------------------------- ---- -------- -------
Profit attributable to owners of the parent during
the year 2,935 1,604
----------------------------------------------------- ---- -------- -------
Earnings per share for profit on total operations
attributable to owners of the parent during the
year
Basic earnings per ordinary share (pence) 8 2.32p 1.28p
Diluted earnings per ordinary share (pence) 8 2.30p 1.26p
COnsolidated statement of
comprehensive income FOR THE YEAR
ED 30 sEPTEMBER 2021
Group Group
2021 2020
GBP'000 GBP'000
----------------------------------------------------- ------- -------
Net profit for the year 2,935 1,604
------------------------------------------------------ ------- -------
Other comprehensive expense
Items that will or may be reclassified to profit
or loss
Exchange differences on retranslation of overseas
subsidiaries (129) (353)
Total other comprehensive expense (129) (353)
------------------------------------------------------ ------- -------
Total comprehensive income for the year attributable
to owners of the parent 2,806 1,251
------------------------------------------------------ ------- -------
consolidated statement of financial position AS AT 30 september
2021
COMPANY NUMBER: 03998880 Group Group
2021 2020
GBP'000 GBP'000
-------------------------------------- -------- --------
Non-current assets
Goodwill and intangible assets 13,543 12,551
Property, plant and equipment 1,756 1,937
Right of use assets 1,978 2,182
Financial asset - investments 236 305
Deferred tax asset 1,877 974
-------------------------------------- -------- --------
19,390 17,949
Current assets
Inventories 2,494 3,439
Trade and other receivables 6,099 9,224
Current tax debtor 118 82
Cash and cash equivalents 22,957 14,940
-------------------------------------- -------- --------
31,668 27,685
Current liabilities
Trade and other payables (12,504) (9,931)
Lease liabilities (582) (426)
(13,086) (10,357)
Net current assets 18,582 17,328
-------------------------------------- -------- --------
Total assets less current liabilities 37,972 35,277
-------------------------------------- -------- --------
Non-current liabilities
Other liabilities (883) (609)
Lease liabilities (1,563) (1,909)
Provisions (32) (24)
Deferred tax liability (3,058) (1,994)
-------------------------------------- -------- --------
(5,536) (4,536)
-------------------------------------- -------- --------
Net assets 32,436 30,741
-------------------------------------- -------- --------
Capital and reserves attributable
to
owners of the parent
-------------------------------------- -------- --------
Share capital 317 314
Shares to be issued 65 65
Share premium account 18,483 17,763
Retained earnings 13,538 12,437
Foreign currency translation reserve 33 162
-------------------------------------- -------- --------
Total equity shareholders' funds 32,436 30,741
-------------------------------------- -------- --------
consolidated STATEMENT of CASHFLOWS
For the year ended 30 september 2021
Group Group
2021 2020
Restated*
GBP'000 GBP'000
------------------------------------------ ------- ------------
Cash flows from operating activities
Group operating profit/(loss) 3,323 1,694
Depreciation and amortisation 3,339 3,448
Impairment of intangible assets 1,341 72
Impairment of investment - -
Increase in fair value of investment (68) -
Share-based payments 98 160
Exchange adjustments (69) (200)
Decrease/(increase) in inventories 1,144 (225)
Decrease in receivables 3,126 2,248
Increase/(decrease) in payables 2,223 (177)
Cash generated from operating activities 14,457 7,020
Tax paid (102) (157)
------------------------------------------ ------- ------------
Net cash from operating activities 14,355 6,863
Cash flows from investing activities
Purchase of property, plant and
equipment (239) (310)
Purchase of intangible assets (2,778) (2,511)
Purchase of investment - (236)
Proceeds on disposal of property,
plant and equipment 11 33
Interest received 4 20
Dividends received - -
Acquisition of subsidiary undertaking
net of cash acquired (1,149) (128)
------------------------------------------ ------- ------------
Net cash used in investing activities (4,151) (3,132)
Cash flows from financing activities
Principal paid on lease liabilities (504) (594)
Interest paid (1) (2)
Interest paid on lease liabilities (105) (101)
Issue of ordinary shares 687 322
Equity dividends paid (2,264) (2,253)
------------------------------------------ ------- ------------
Net cash used in financing activities (2,187) (2,628)
------------------------------------------ ------- ------------
Net increase in cash and cash equivalents 8,017 1,103
Cash and cash equivalents at beginning
of the period 14,940 13,837
Cash and cash equivalents at end
of the period 22,957 14,940
------------------------------------------ ------- ------------
*In the prior year the principal paid on lease liabilities was
previously included within cash generated from operating
activities. The cashflows in the statement above have been restated
to correctly include them within cash flows from financing
activities.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 30
SEPTEMBER 2021
Foreign
currency
Share Shares Share premium Retained translation
Group capital to be issued account earnings reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------- -------- ------------- ------------- --------- ------------ -------
Balance as at 30 September
2019 313 65 17,417 12,851 515 31,161
Net profit for the year - - - 1,604 - 1,604
Exchange differences on
retranslation of overseas
subsidiaries - - - - (353) (353)
Transactions with owners:
Tax recognised directly
in equity in relation to
employee share option schemes - - - 100 - 100
Dividends - - - (2,253) - (2,253)
Issue of share capital 1 - 346 - - 347
Share based payment charge - - - 135 - 135
Balance as at 30 September
2020 314 65 17,763 12,437 162 30,741
Net profit for the year - - - 2,935 - 2,935
Exchange differences on
retranslation of overseas
subsidiaries - - - - (129) (129)
Transactions with owners:
Tax recognised directly
in equity in relation to
employee share option schemes - - - 368 - 368
Dividends - - - (2,264) - (2,264)
Issue of share capital 3 - 720 - - 723
Share based payment charge - - - 62 - 62
Balance as at 30 September
2021 317 65 18,483 13,538 33 32,436
------------------------------- -------- ------------- ------------- --------- ------------ -------
1. B asis of preparation of the financial information
The financial information in this preliminary announcement has
been prepared in accordance with the recognition and measurement
criteria of IFRS. This announcement does not itself contain
sufficient information to comply with IFRS. The Company expects to
publish full financial statements that comply with IFRS on 2(rd)
December 2021.
The preparation of financial statements in conformity with IFRS
requires the use of certain critical accounting estimates. It also
requires management to exercise judgement in the process of
applying the Group's accounting policies which affect the reported
amount of assets and liabilities at the statement of financial
position date and the reported amounts of revenues and expenses
during the reported period. Although the estimates are based on
management's best knowledge of the amount, event or actions, actual
results may ultimately differ from those estimates.
The financial information set out in this preliminary
announcement does not constitute statutory accounts as defined in
Section 434 of the Companies Act 2006 for the years ended 30
September 2021 and 30 September 2020 but is derived from those
accounts. The statutory accounts for the year ended 30 September
2020 have been delivered to the Registrar of Companies and those
for the year ended 30 September 2021 will be delivered following
the Company's annual general meeting. The auditors have reported on
those accounts: their report was unqualified, did not contain
references to any matters to which the auditors drew attention by
way of emphasis and did not contain a statement under Section 498
of the Companies Act 2006 for the year ended 30 September 2021 or
30 September 2020.
2. Basis of consolidation
The consolidated financial information incorporates the results
of the Company and all of its subsidiary undertakings drawn up to
30 September 2021.
3. Revenue from contracts with customers
All revenue is from continuing operations.
2021 2020
Revenue GBP'000 GBP'000
--------------------- ------- -------
Vicon UK 17,260 13,540
Vicon USA 10,311 9,228
--------------------- ------- -------
Vicon Group 27,571 22,768
--------------------- ------- -------
Yotta 8,056 7,530
Oxford Metrics Group 35,627 30,298
--------------------- ------- -------
Timing of the transfer 2021
of goods
and services Vicon UK Vicon USA Yotta Total
GBP'000 GBP'000 GBP'000 GBP'000
------------------------ -------- --------- ------- -------
Point in time 15,606 8,353 1,747 25,706
Over time 1,654 1,958 6,309 9,921
------------------------ -------- --------- ------- -------
Oxford Metrics Group 17,260 10,311 8,056 35,627
------------------------ -------- --------- ------- -------
Contract Counterparties
------------------------ -------- --------- ------- -------
Direct to consumers 4,750 9,265 6,773 20,788
Third party distributor 12,510 1,046 1,283 14,839
------------------------ -------- --------- ------- -------
Oxford Metrics Group 17,260 10,311 8,056 35,627
------------------------ -------- --------- ------- -------
By destination
------------------------ -------- --------- ------- -------
UK 3,519 - 7,741 11,260
Germany 1,591 - - 1,591
Italy 484 - - 484
Netherlands 435 - 22 457
France 220 - - 220
Poland 355 - - 355
Rest of Europe 1,601 - 6 1,607
Canada - 1,221 - 1,221
USA - 8,920 - 8,920
Rest of North America 2 104 - 106
Australia 530 - 269 799
Hong Kong 1,277 - - 1,277
Japan 3,290 - - 3,290
South Korea 1,364 - - 1,364
China 2,254 - - 2,254
Rest of Asia Pacific 338 - - 338
Other - 66 18 84
------------------------ -------- --------- -------
Oxford Metrics Group 17,260 10,311 8,056 35,627
------------------------ -------- --------- ------- -------
Timing of the transfer 2020
of goods
and services Vicon UK Vicon USA Yotta Total
GBP'000 GBP'000 GBP'000 GBP'000
------------------------ -------- --------- ------- -------
Point in time 12,240 7,231 1,775 21,246
Over time 1,300 1,997 5,755 9,052
------------------------ -------- --------- ------- -------
Oxford Metrics Group 13,540 9,228 7,530 30,298
------------------------ -------- --------- ------- -------
Contract Counterparties
------------------------ -------- --------- ------- -------
Direct to consumers 2,831 8,617 6,420 17,868
Third party distributor 10,709 611 1,110 12,430
------------------------ -------- --------- ------- -------
Oxford Metrics Group 13,540 9,228 7,530 30,298
------------------------ -------- --------- ------- -------
By destination
------------------------ -------- --------- ------- -------
UK 2,248 - 7,227 9,475
Germany 613 - - 613
Italy 231 - - 231
Netherlands 449 - 29 478
France 189 - - 189
Switzerland 294 - - 294
Russia 350 - - 350
Rest of Europe 1,003 - 2 1,005
Canada - 1,006 - 1,006
USA 1 7,706 - 7,707
Rest of North America 6 227 - 233
Australia 1,307 - 256 1,563
Hong Kong 3,205 - - 3,205
Japan 3,061 - - 3,061
South Korea 323 - - 323
Rest of Asia Pacific 260 - 260
Other - 289 16 305
------------------------ -------- --------- -------
Oxford Metrics Group 13,540 9,228 7,530 30,298
------------------------ -------- --------- ------- -------
2021 2020
GBP'000 GBP'000
----------------------------- --------- ---------
Vicon revenue by market
Engineering 5,763 4,139
Entertainment 11,884 6,732
Life sciences 9,106 10,696
Location based entertainment 818 1,201
Vicon Group* 27,571 22,768
----------------------------- --------- ---------
Yotta revenue by
type
Software 4 12
Rendering of services 2,057 2,095
SaaS 3,164 2,680
Support 2,831 2,743
Yotta Group 8,056 7,530
---------------------- ----- -----
Group revenue
by type
Sale of hardware 22,496 18,221
Sale of software 1,666 1,578
Rendering of
services 4,542 3,958
SaaS 3,305 2,790
Support 3,618 3,751
----------------- ------ ------
Oxford Metrics
Group 35,627 30,298
----------------- ------ ------
Group revenue by origin
UK 24,786 20,796
Europe 238 -
North America 10,311 9,228
Asia Pacific 292 274
------------------------
Oxford Metrics Group 35,627 30,298
------------------------ ------ ------
*This additional information is provided to the Chief Operating
Decision Maker. Further analysis by market is not available.
Contract balances
2021
Contract assets Contract liabilities
GBP'000 GBP'000
---------------------------------------------- --------------- --------------------
At 1 October 2020 411 5,850
Transfers from contract assets to trade
receivables (1,525) -
On acquisition - 227
Amounts included in contract liabilities
recognised as revenue during the period - (13,459)
Excess of revenue recognised over cash during
the period 1,375 -
Cash received in advance of performance
and not recognised as revenue during the
period - 14,926
Foreign exchange differences - (70)
At 30 September 2021 261 7,474
---------------------------------------------- --------------- --------------------
2020
Contract assets Contract liabilities
GBP'000 GBP'000
---------------------------------------------- --------------- --------------------
At 1 October 2019 787 5,370
Transfers from contract assets to trade
receivables (1,518) -
Amounts included in contract liabilities
recognised as revenue during the period - (9,498)
Excess of revenue recognised over cash during
the period 1,141 -
Cash received in advance of performance
and not recognised as revenue during the
period - 10,062
Foreign exchange differences 1 (84)
At 30 September 2020 411 5,850
---------------------------------------------- --------------- --------------------
Contract assets and contract liabilities are included within
trade and other assets and trade and other payables and other
liabilities respectively on the face of the statement of financial
position. They arise primarily from the Group's software and
support contracts which are delivered over time and where the
cumulative payments received from customers at each balance sheet
date do not necessarily equal the amount of revenue recognised on
the contract.
Remaining performance obligations
The majority of the Group's contracts are for the delivery of
goods and services within the next 12 months for which the
practical expedient in paragraph 121(a) of IFRS 15 applies.
However, some software and support contracts are for a period
greater than 12 months and the amount of revenue that will be
recognised in future periods on these contracts is as follows:
At 30 September
2021 2022 2023 2024 2025 2026 2027
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------- ------- ------- ------- ------- ------- -------
Support contracts 2,972 414 249 83 22 11
Software contracts 3,143 1,378 590 199 - -
6,115 1,792 839 282 22 11
------------------- ------- ------- ------- ------- ------- -------
At 30 September
2020 2021 2022 2023 2024 2025 2026
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------- ------- ------- ------- ------- ------- -------
Support contracts 2,649 604 376 299 281 8
Software contracts 1,477 862 473 301 - -
4,126 1,466 849 600 281 8
------------------- ------- ------- ------- ------- ------- -------
4. Segmental analysis
Segment information is presented in the financial statements in
respect of the Group's business segments, which are reported to the
Chief Operating Decision Maker (CODM). The Group has identified the
Board of Directors of Oxford Metrics plc ("the Board") as the CODM.
The business segment reporting reflects the Group's management and
internal reporting structure.
The Group comprises the following business segments:
-- Vicon Group: This is the development, production and sale of computer
software and equipment for the engineering, entertainment and
life science markets; and
-- Yotta Group: This is the provision of software and services for
the management of infrastructure assets for Government Agencies,
Local Government and major infrastructure contractors.
Other unallocated costs represent head office expenses not
recharged to subsidiary companies.
Inter segment transfers are priced along the same lines as sales
to external customers, with an appropriate discount being applied
to encourage use of Group resources. This policy was applied
consistently throughout the current and prior year. There were no
significant inter segment transfers during the current or prior
year.
Intra segment sales between Vicon UK and Vicon USA are
eliminated prior to management and internal reporting, and hence
are not shown separately in the analysis below. The total intra
segment sales between Vicon UK and Vicon USA in the year ended 30
September 2021 are GBP4,439,000 (2020: GBP3,766,000).
Segment assets consist primarily of property, plant and
equipment, intangible assets, inventories and trade and other
receivables. Unallocated assets comprise deferred taxation,
investments and cash and cash equivalents.
2021 2020
Adjusted Adjusted
profit/(loss) Profit/(loss) profit/(loss)
before Adjusting Group before before Adjusting Group Profit/(loss)
tax items recharges tax tax items recharges before tax
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------ ------------- --------- ---------- ------------- ------------- --------- ---------- -------------
Vicon UK 3,229 (1,344) 1,130 3,015 1,571 (275) 393 1,689
Vicon USA 3,562 - (3,065) 497 3,277 - (2,218) 1,059
------------ ------------- --------- ---------- ------------- ------------- --------- ---------- -------------
Vicon Group 6,791 (1,344) (1,935) 3,512 4,848 (275) (1,825) 2,748
------------ ------------- --------- ---------- ------------- ------------- --------- ---------- -------------
Yotta 793 (286) (920) (413) (115) (398) (758) (1,271)
Unallocated (2,763) 30 2,855 122 (2,174) (304) 2,583 105
Oxford
Metrics
Group 4,821 (1,600) - 3,221 2,559 (977) - 1,582
------------ ------------- --------- ---------- ------------- ------------- --------- ---------- -------------
Adjusted profit before tax is detailed in note 6.
Segment depreciation and amortisation
2021 2020
GBP'000 GBP'000
--------------------- ------------------- ------------------
Vicon UK 3,436 2,263
Vicon USA 208 208
--------------------- ------------------- ------------------
Vicon Group 3,644 2,471
--------------------- ------------------- ------------------
Yotta 998 1,031
Unallocated 38 18
--------------------- ------------------- ------------------
Oxford Metrics Group 4,680 3,520
--------------------- ------------------- ------------------
Additions to Carrying amount Carrying amount
Non-current assets non-current assets of segment assets of segment liabilities
2021 2020 2021 2020 2021 2020 2021 2020
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------- --------- --------- ---------- --------- --------- --------- ------------ -----------
Vicon UK 10,324 9,581 2,137 3,221 22,962 23,320 (8,702) (5,827)
Vicon USA 941 1,071 33 317 6,971 5,938 (2,989) (2,802)
---------------- --------- --------- ---------- --------- --------- --------- ------------ -----------
Vicon Group 11,265 10,652 2,170 3,538 29,933 29,258 (11,691) (8,629)
---------------- --------- --------- ---------- --------- --------- --------- ------------ -----------
Yotta Group 7,262 6,664 1,078 1,806 13,193 16,511 (5,952) (5,856)
Unallocated 863 633 94 247 13,984 5,917 (979) (408)
OMG Life Group* - - - - (6,052) (6,052) - -
Oxford Metrics
Group 19,390 17,949 3,342 5,591 51,058 45,634 (18,622) (14,893)
---------------- --------- --------- ---------- --------- --------- --------- ------------ -----------
* The negative balance within segment assets represents a cash
overdraft which is part of the Group's cash offset facility.
5. Profit for the year
The profit for the year is stated after charging /
(crediting):
2021 2020
GBP'000 GBP'000
------------------------------------------------------ ------- -------
Amortisation of right of use assets 522 528
Depreciation of property, plant and equipment - owned 495 610
Amortisation of customer relationships 249 312
Amortisation of intellectual property 261 245
Amortisation of development costs 1,812 1,753
Impairment of development costs 360 72
Impairment of intellectual property 981 -
Share based payments - equity settled 36 25
Share option charges 62 135
Operating lease charges - land and buildings 3 -
Foreign exchange gain/(loss) 10 (24)
Grant income receivable - (163)
------------------------------------------------------ ------- -------
6. Reconciliation of adjusted profit before tax
The adjusted profit before tax is considered by the Board to
more accurately reflect the underlying operating performance of the
business on a go-forward basis and complements the statutory
measure as reported in the Consolidated Income Statement.
The reconciliation of profit before tax to adjusted profit
provided below includes items that are:
-- non-recurring in nature, such as redundancy costs incurred
from time to time, acquisition costs and results of the Group's
equity accounted associate, which are not core to operations
or future operating performance.
-- non-cash moving items which arise from the accounting treatment
of share based payments and the amortisation of acquired intangibles
which affect neither future operating performance nor cash
generation.
The above definition has been consistently applied historically
and is the measure by which the market generally judges PBT
performance.
2021 2020
GBP'000 GBP'000
----------------------------------------------------- ------- -------
Profit before tax 3,221 1,582
Share option charges 62 135
Amortisation of intangibles arising on acquisition 507 541
Impairment of intangible arising on acquisition 981 -
Reorganisation costs 32 74
Aborted transaction costs - 198
Costs associated with the acquisition of Contemplas 86 -
Adjustment to fair value of investment (68) -
Share of post-tax loss of equity accounted associate - 29
Adjusted profit before tax 4,821 2,559
----------------------------------------------------- ------- -------
Adjusted earnings per share for
profit on total operations attributable
to owners of the parent during the
year
Basic earnings per share (pence) 3.59p 2.05p
Diluted earnings per share (pence) 3.56p 2.02p
The adjusted profit before tax for the Vicon and Yotta business
segments which are included within the Group's continuing
operations is shown in detail below;
Vicon Group
2021 2020
GBP'000 GBP'000
---------------------------------------------------- ------- -------
Profit before tax 3,512 2,748
Share option charges 13 33
Amortisation of intangibles arising on acquisition 258 242
Impairment of intangible arising on acquisition 981 -
Reorganisation costs 6 -
Costs associated with the acquisition of Contemplas 86 -
Reapportion Group overheads 1,935 1,825
Adjusted profit before tax 6,791 4,848
---------------------------------------------------- ------- -------
Yotta Group
2021 2020
GBP'000 GBP'000
--------------------------------------------------- ------- -------
Loss before tax (413) (1,271)
Share option charges 11 25
Amortisation of intangibles arising on acquisition 249 299
Reorganisation costs 26 74
Reapportion Group overheads 920 758
Adjusted profit/(loss) before tax 793 (115)
--------------------------------------------------- ------- -------
7. Taxation
The tax is based on the profit for the year and represents:
2021 2020
GBP'000 GBP'000
------------------------------------------------------ ------- -------
United Kingdom corporation tax at 19.0% (2020: 19.0%) 60 89
Overseas taxation 228 297
Adjustments in respect of prior year (3) (56)
------------------------------------------------------ ------- -------
Current taxation 285 330
Deferred taxation 1 (352)
------------------------------------------------------ ------- -------
Total taxation expense/(credit) 286 (22)
------------------------------------------------------ ------- -------
At 30 September 2021, the Group had an undiscounted deferred tax
asset of GBP1,877,000 (2020: GBP974,000). The asset comprises
principally short term timing differences, future tax relief
available on the exercise of outstanding employee share options in
Oxford Metrics plc and unrelieved trading losses carried forward
for which recoverability is reasonably certain.
Deferred tax assets and liabilities have been measured at an
effective rate of 25% in both the UK and USA, respectively (2020:
19% and 25%, respectively).
The tax assessed for the year is lower than the standard rate of
corporation tax in the UK of 19.0% (2020: lower than the standard
rate of 19%).
The differences are explained as follows:
2021 2020
GBP'000 GBP'000
---------------------------------------------------- ------- -------
Profit on ordinary activities before tax 3,221 1,582
---------------------------------------------------- ------- -------
Expected tax income based on the standard rate of
corporation tax in the UK of 19.0% (2020: 19.0%) 612 300
Effect of:
Expenses not deductible for tax purposes 255 90
Recognition of previously unrecognised deferred tax
asset - (37)
Unrelieved current year losses (161) 90
Utilisation of losses brought forward (32) (14)
Adjustments to tax charge in respect of prior year
current tax (8) (56)
Adjustments to tax charge in respect of prior year
deferred tax (62) -
Higher rates on overseas taxation 42 86
Research and development tax credit (310) (621)
Effect of tax rate change (50) 140
---------------------------------------------------- ------- -------
Total tax expense/(credit) 286 (22)
---------------------------------------------------- ------- -------
During the year the UK Government substantively enacted an
increase in the corporation tax rate to 25.0% effective from 1
April 2023. The deferred tax asset and liability as at 30 September
2021 has been calculated based on the rate of 25.0% unless the
asset/liability is expected to be realised or settled before the
rate increase in which case the rate of 19.0% has been used.
8. Earnings per share
2021 2020
------------------------------- -------------------------------
Weighted Weighted
average average
number Per share number of Per share
Earnings of shares amount Earnings shares amount
GBP'000 '000 (pence) GBP'000 '000 (pence)
-------------------------------- -------- ---------- --------- -------- ---------- ---------
Continuing and total operations
Basic earnings per share
Earnings attributable to
ordinary shareholders 2,935 126,437 2.32 1,604 125,568 1.28
Dilutive effect of employee
share options - 993 (0.02) - 2,083 (0.02)
Diluted earnings per share 2,935 127,430 2.30 1,604 127,651 1.26
-------------------------------- -------- ---------- --------- -------- ---------- ---------
Basic earnings per share is calculated by dividing the profit
attributable to equity holders of the Company by the weighted
average number of ordinary shares in issue during the year.
Diluted earnings per share is calculated by adjusting the
weighted average number of ordinary shares outstanding to assume
conversion of all dilutive potential ordinary shares (share
options). For share options a calculation is done to determine the
number of shares that could have been acquired at fair value
(determined as the average annual market share price of the
Company's shares) based on the monetary value of the subscriptions
rights and outstanding share based payment charges attached to
outstanding share options. The number of shares calculated as above
is compared with the number of shares that would have been issued
assuming the exercise price of the share options.
9. Dividends
Equity - ordinary GBP'000 GBP'000
----------------------------------------------- ------- -------
Final 2019 paid in 2020 (1.80 pence per share) - 2,253
Final 2020 paid in 2021 (1.80 pence per share) 2,264 -
2,264 2,253
----------------------------------------------- ------- -------
The directors are proposing a final dividend in respect of the
financial year ended 30 September 2021 of 2.0 pence per share
(2020: 1.80 pence per share) which will absorb an estimated
GBP2,539,000 of shareholders' funds. This dividend will be paid on
23 February 2022 to shareholders who are on the register of members
at close of business on 10 December 2021 subject to approval at the
AGM. These dividends have not been accrued in these financial
statements.
10. Copies of announcement
Copies of this announcement will be available from the Company's
registered office at 6 Oxford Industrial Park, Yarnton,
Oxfordshire, OX5 1QU and from the Company's website:
www.oxfordmetrics.com .
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