RNS Number:5539S
Workplace Systems International PLC
27 November 2003
Workplace Systems International PLC 27 November 2003
Workplace Systems International PLC
Interim Results for the six months to 30 September 2003
CHAIRMAN'S STATEMENT
Introduction
The results for the six months ended 30th September 2003 have shown a
significant improvement in the trading performance of the Group when compared to
the same period last year. The period has seen a continuation of the trading
recovery within the Workplace division which started in the second half of the
financial year to 31st March 2003 and the satisfactory sale of the Group's
TeleWare division. Following completion of the sale, the Group's name was
changed to Workplace Systems International PLC.
The sale of the TeleWare division was completed following shareholder approval
on 14th July 2003. The initial consideration was #1.3 million cash and the
cancellation of 37.4 million ordinary shares in the Group with a deferred
payment of #0.7 million payable in March 2004. The sale gave rise to a profit
on disposal of #0.9 million.
Workplace has continued to invest significantly in new product development to
maintain its leading position in the Labour Management Software market.
Approximately 45% of total employees are engaged directly in the development of
new and existing products.
Workplace has now been cash generative for over 12 months, allowing the Group to
improve its already strong cash position.
Financial Results
Continuing Operations
The Workplace division showed a turnover level of #4.2 million for the six
months to 30th September 2003 (2002: #3.3 million). The recurring revenues
received from Annual Use Licences increased to #1.9 million (2002: #1.7 million)
and account for 45% on the turnover (2002: 52%). An operating profit was
achieved of #0.3 million (2002: loss of #1.5 million) before exceptional items
and amortisation of #0.3 million (2002: #0.8 million).
Discontinued Operations
For the period to 14th July 2003 TeleWare achieved a turnover of #2.0 million
and an operating loss of #0.3 million.
Combined Operations
The combined operations of the business showed a turnover of #6.2 million (2002:
#6.6 million) and an operating profit of #24,000 (2002: loss #2.2 million)
before exceptional items and amortisation of goodwill of #0.3 million (2002: to
#0.8 million).
The operating loss was #0.3 million (2002: loss of #3.0 million). A profit of
#0.9 million was made on the sale of TeleWare. Retained profit was #0.7 million
(2002: loss of #2.9 million).
There was a nil taxation charge for the period (2002: Nil) due to the
utilisation of losses brought forward from previous years.
Earnings per share pre-exceptional items and amortisation of goodwill was 0.624p
(2002: loss per share 1.157p). Post-exceptional items and amortisation of
goodwill, the basic and diluted earnings per share was 0.455p (2002: loss per
share 1.614p).
Cash Flow
The Group's cash position including money market deposits increased to #6.4
million from #4.2 million at 30th September 2002 and #4.9 million at 31st March
2003.
The improvement in cash of #1.5 million in the six months to September 2003
resulted from the positive cash flow performance from the Workplace division and
the initial receipt for the sale of the TeleWare division. The Group continues
to manage working capital closely to help maintain its strong cash position.
The deferred payment from the sale of TeleWare due to be received in March 2004
will further improve cash flow by #0.7 million in the second half of the
financial year.
Dividend
As Workplace is now profitable and cash generative with significant cash
balances, it is anticipated that a dividend will be paid at the year end in line
with the Group's previously stated dividend policy.
Business Performance of Workplace
Trading has continued at similar levels to the second half of the last financial
year with little improvement in market conditions.
The sales order book level has not changed materially during the 6 month period
but continues to be well spread with a large number of small to medium sized
orders which is the typical profile for the company. In addition Workplace has
seen improvements in the sales pipeline in the retail and transport sectors and
continues to be in advanced discussions regarding larger opportunities with a
number of major retail organisations.
Workplace software modules address all areas of labour management including
staff forecasting, scheduling/rostering, budgeting and productivity and
performance reporting. These products are relevant to all market sectors but
are receiving increased focus from the retail, hospitality, emergency services,
health, retail finance, transport and supply chain sectors. Significant labour
cost savings and improved service levels are benefits often reported from
implementation of Workplace products. Workplace's sales approach is focused on
these customer benefits and accordingly it has achieved sales to a number of
significant businesses including Metro Retail, Rank Leisure, Liptons, Gallaher
and Severn Trent Water.
The leading competitive position of the Workplace scheduling products was
recognised in the June 2003 Retail Week annual survey of software suppliers to
the top-100 UK retailers.
Outlook
Following the sale of TeleWare all management efforts are now fully focused on
Workplace. The business remains financially sound with a strong cash position
and a significant proportion of recurring revenues. I expect to see a
continuation of the first half performance during the coming months with the
opportunity of further progress as business investment decisions return to more
normal levels.
Ian Lenagan
Chairman
Workplace Systems International PLC
Consolidated Profit & Loss Account
Six months ended 30 September 2003
Year ended
2003 2002 31 March 2003
unaudited unaudited audited
#'000 #'000 #'000
Continuing operations
Turnover 4,245 3,356 7,581
Operating profit/(loss) before exceptional items 277 (1,452) (1,326)
and amortisation of goodwill
Exceptional items - (514) (514)
Amortisation of goodwill (264) (287) (529)
Operating profit/(loss) 13 (2,253) (2,369)
Discontinued operations
Turnover 2,000 3,220 6,660
Operating profit/(loss) before exceptional items (253) (707) (1,323)
and amortisation of goodwill
Exceptional items - - -
Amortisation of goodwill (14) (23) (46)
Operating loss (267) (730) (1,369)
Combined operations
Turnover 6,245 6,576 14,241
Operating profit/(loss) before exceptional items 24 (2,159) (2,649)
and amortisation of goodwill
Exceptional items - (514) (514)
Amortisation of goodwill (278) (310) (575)
Operating loss (254) (2,983) (3,738)
Profit on sale of subsidiary company 909 - -
Net interest received 92 71 183
Profit/(loss) on ordinary activities before taxation 747 (2,912) (3,555)
Taxation on profit/(loss) on ordinary activities - - 813
Profit/(loss) on ordinary activities after taxation 747 (2,912) (2,742)
Equity dividends - - -
Retained profit/(loss) for the period 747 (2,912) (2,742)
Post-exceptional items and amortisation of goodwill:
Basic and diluted earnings/(loss) per share 0.455 (1.614) (1.519)
Pre-exceptional items and amortisation of goodwill:
Adjusted basic and diluted earnings/(loss) per share 0.624 (1.157) (0.916)
Dividend per ordinary share NIL NIL NIL
Workplace Systems International PLC
Consolidated Balance Sheet
Six months ended 30 September 2003
Year ended
2003 2002 31 March 2003
unaudited unaudited audited
#'000 #'000 #'000
Fixed assets
Intangible 8,661 9,988 9,723
Tangible 1,188 2,817 2,723
9,849 12,805 12,446
Current assets
Stocks 5 786 740
Debtors 2,990 5,225 5,279
Investments: money market deposits 5500 4,000 4,500
Cash at bank and in hand 935 215 432
Cash at bank and in hand and money market deposits 6,435 4,215 4,932
9,430 10,226 10,951
Creditors:amounts falling due within one year (1,306) (1,942) (1,637)
Net current assets 8,124 8,284 9,314
Total assets less current liabilities 17,973 21,089 21,760
Provisions for liabilities & charges - (123) -
Deferred income (1,817) (4,231) (4,854)
Net Assets 16,156 16,735 16,906
Capital and reserves
Called up share capital 7,152 9,023 9,023
Capital Redemption Reserve 1,871 - -
Share premium account 8,607 8,607 8,607
Profit & loss account (1,474) (895) (724)
Equity shareholder funds 16,156 16,735 16,906
Workplace Systems International PLC
Consolidated Cash Flow Statement
Six months ended 30 September 2003
2003 2002 Year ended
unaudited unaudited 31 March 2003
#'000 #'000 audited
#'000
Net cash inflow/(outflow) from operations 1,290 (1,743) (882)
Returns on investments & servicing of finance 92 71 183
Corporation tax refunded - 609 602
Capital expenditure (71) (142) (379)
Disposal of subsidiary 1,689 - -
Cash inflow/(outflow) before use of liquid resources and 3,000 (1,205) (476)
financing
Management of liquid resources (1,000) - (500)
Financing (1,497) (21) (33)
Increase/(decrease) in cash 503 (1,226) (1,009)
Notes to the Consolidated Cash Flow Statement
Reconciliation of operating loss to net cash inflow/(outflow)
from operating activities
Operating (loss)/profit (254) (2,983) (3,738)
Depreciation 294 456 892
Profit/(loss) on disposal of assets - - (76)
Goodwill amortisation 278 310 575
Decrease in working capital 972 474 1,465
Net cash inflow/(outflow) from operations 1,290 (1,743) (882)
Workplace Systems International PLC
Notes to the Interim Results
1. Basis of preparation
The summarised unaudited half year financial information does not constitute
statutory accounts for the purposes of section 240 of the Companies Act 1985.The
statutory accounts for the year ended 31 March 2003,which received an
unqualified report, have been delivered to the Registrar of Companies.
The unaudited financial information has been prepared on the basis of the
accounting policies set out in the Group's 31 March 2003 audited statutory
accounts.
Copies of this statement of interim results are being sent to all shareholders
shortly and thereafter will be available from the Group's registered office.
2. Taxation
The taxation (credit)/charge for the period.
Comprises:
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2003 2002 2003
unaudited unaudited audited
#'000 #'000 #'000
UK corporation tax - - (490)
Deferred Tax - - (323)
- - (813)
3. Reconciliation of movement in shareholders' funds
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2003 2002 2003
unaudited unaudited audited
#'000 #'000 #'000
Profit/(loss) for period 747 (2,912) (2,742)
Opening shareholders funds 16,906 19,648 19,648
Purchase of own shares (1,497) - -
Closing shareholders funds 16,156 16,736 16,906
Earnings Per Share
Six months Six months
ended ended Year ended
30 September 30 September 31 March
2003 2002 2003
unaudited unaudited audited
#'000 #'000 #'000
Post-exceptional items and
amortisation of goodwill
Profit/(loss) per share - basic and diluted
Profit/(loss) attributable to shareholders (#000) 747 (2,912) (2,742)
Weighted average number of shares (000's) 164,306 180,460 180,460
Amount per share (pence) 0.455 (1.614) (1.519)
Pre-exceptional items and
amortisation of goodwill
Adjusted basic EPS
Profit / (loss) attributable to shareholders (#000) 747 (2,912) (2,742)
Exceptional items (#000) - 514 514
Goodwill (#000) 278 310 575
1,025 (2,088) (1,653)
Adjusted profit/(loss) per share - basic and diluted
Profit/(loss) attributable to shareholders (#000) 1,025 (2,088) (1,653)
Weighted average number of shares (000's) 164,306 180,460 180,460
Amount per share (pence) 0.624 (1.157) (0.916)
This information is provided by RNS
The company news service from the London Stock Exchange
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