Interim Results
05 3월 2008 - 4:02PM
UK Regulatory
RNS Number:3800P
Inspectron Holdings PLC
05 March 2008
Inspectron Holdings plc
5 March 2008
Inspectron Holdings plc ('Inspectron' or the 'Company')
Interim Results for the Six Months Ended 31 January 2008
I am pleased to report that the first half results show a return to profit. This
result includes trading in only the Integrity division of the company, since the
other activities were sold on July 31, 2007. Since the disposal, management has
been able to concentrate on searching for, and fulfilling new business,
primarily connected with production of electronic passports and security print
verification. This type of activity offers high gross margins, the highest
calibre of customers in the world, and a good ongoing revenue stream as a result
of support contract income.
The result for the first half of this year shows a profit on operations of
c.�67,000 (2007: c.�356,000 loss). Turnover for continuing operations increased
56% to �1.2 million (2007: �0.8 million). Earnings per share were 0.44 pence
(2007: 3.10 pence loss per share). Cash was �222,000 at 31 January 2008 (2007:
�214,000), and net liabilities were �211,000 (2007: �398,000). The Board does
not propose the payment of an interim dividend.
Operational overview
In Europe, we trade under the Inspectron name, in other areas of the world we
continue to trade as Formscan. The solutions we provide are essentially software
and know-how.
Whether our customer is producing credit card statements or electronic
passports, the risk of mix-up of personal data must be eliminated. Typically,
banks and government printing departments will use a combination of machines for
production. Machine or operator errors happen naturally, and it is our task to
provide a solution, which identifies anomalies early in the process, in order to
give the production manager advance warning and a recovery path, before it is
too late.
To do this, we attach a variety of tracking solutions, such as cameras, barcode
readers and RFID chip readers, supported by high speed decision-making software,
to important stages of the production machines. Over the years we have developed
a range of flexible software, which allows integration with a wide variety of
host machines. Our skilled applications staff then fine-tune this software to
exact customer specifications. Once the solution is operational, we provide
ongoing support contracts, which enable the customer to maintain and improve the
solution over a period of years.
Our typical solution value is between �50,000 and �500,000, and our target
customers are located all around the world. Normally, we handle USA and Asia
through our US subsidiary, and Europe and other countries from UK. Contracts
normally include stage payments, and are thus usually self-funding.
We re-invest a proportion of our income into new software and marketing
activities, aimed at identifying new opportunities to leverage our software and
skills.
The year started with the installation, training and operational acceptance of
an e-Passport making system in Asia. This job was completed in November, and the
customer has recently ordered a second system, which will be installed later
this year. In December, we also completed the first phase of another
installation for an existing North American e-Passport customer, and we are
currently preparing for operational testing and deployment. In September, we
exhibited at the Graphexpo trade show in Chicago. This led to a new relationship
with a Japanese customer, who has since ordered two of our high speed camera
tracking systems. We plan to cooperate further with this customer at the DRUPA
trade show in Dusseldorf later this year. In November, we participated, as part
of our partnership program with Infineon, in the Cartes exhibition in Paris.
This is the annual prestige exhibition for the smart card and intelligent
document industry.
Current Trading
We are currently progressing three contracts, and are in the later stages of
negotiating another. One of these orders was received two weeks ago. This order
backlog should keep us busy for at least the next eight months. Our cash
position is improving and we expect to achieve a net positive and growing cash
position from now onwards.
Future prospects
The turnaround in fortunes achieved over the past year shows every sign of
continuing. The business opportunities and order prospects suggest that we can
plan confidently into next year and beyond. The security print world, especially
with the introduction of intelligent documents chips and an ever increasing use
of smart cards, is demanding more tracking and audit capability, a market area
where we are now well placed to deliver. Having repaired our balance sheet and
won significant new reference customers, we are confidently planning for a
modest expansion of sales and new product developments for the second half of
our financial year to 31 July 2008.
Enquiries:
Allan Harle, Inspectron 01625 828407
Pascal Keane, Shore Capital 020 7408 4090
Inspectron Holdings plc
Consolidated Profit and Loss Account
For the half year ended 31 January 2008
Unaudited Unaudited Audited
Six months to Six months to Year Ended
31 January 31 January 31 July
2008 2007 2007
�'000 �'000 �'000
Revenue
Continuing operations 1,218 780 1,304
Discontinued operations - 644 1,203
1,218 1,424 2,507
Cost of sales 377 1,271 2,389
Gross profit 841 153 118
Operating expenses
Distribution costs 3 27 57
Administrative expenses 771 483 1,250
Operating profit (loss)
Continuing operations 67 (251) (1,105)
Discontinued operations - (105) (84)
67 (356) (1,189)
Interest receivable 2 3 4
Interest payable and similar charges (15) (15) (51)
Profit (Loss) on ordinary activities before 53 (369) (1,237)
exceptional item
Exceptional item - 1,004
53 (369) (232)
Taxation - 15
Profit (Loss) on ordinary activities after 53 (369) (218)
taxation
Attributable to equity holders of the company 53 (369) (218)
Profit (loss) per share attributable to the
equity holders of the company during the period
Basic and diluted earnings (losses) per share .44p (3.10)p (1.83)p
Consolidated Balance Sheet
31 January 2008
Unaudited Unaudited
Six months Six months Audited
ended ended Year ended
31 January 31 January 31 July
2008 2007 2007
�'000 �'000 �'000
Fixed Assets
Tangible assets 322 358 327
Intangible assets 43 49 44
365 407 371
Current Assets
Inventory 31 144 27
Trade and other debtors 521 822 457
Cash at bank and in hand 222 214 30
774 1,180 514
Total Assets 1,139 1,587 885
Liabilities
Current Liabilities
Creditors: Amounts falling due
within one year 1,350 1,985 1,149
Total Liabilities 1,350 1,985 1,149
Equity
Capital and Reserves attributable to equity
holders of the company
Called up share capital 119 119 119
Share premium account 1,248 1,248 1,248
Merger reserves 712 712 712
Revaluation reserves 366 366 366
Capital redemption reserve 5 5 5
Retained losses (2,661) (2,848) (2,714)
Total shareholders' equity (211) (398) (264)
Total equity and liabilities 1,139 1,587 885
Consolidated Cash Flow Statement
for the period ended 31 January 2008
Unaudited Unaudited
Six months Six months Audited
ended ended Year ended
31 January 31 January 31 July
2008 2007 2007
�'000 �'000 �'000
Cash flow from operating activities
Consumed by operations 225 90 (145)
Taxation - - 42
225 90 (103)
Cash flows from investing activities
Interest received 2 3 4
Interest paid (15) (15) (51)
212 78 (150)
Cash flows from capital expenditure
Purchase of tangible fixed assets (4) (17) (48)
Sale of tangible fixed assets - - 34
Net increase in cash and cash 208 61 (164)
equivalents
Translation difference - (9) (10)
Cash and cash equivalents at the (323) (149) (149)
beginning of the period
Cash and cash equivalents at the end (115) (97) (323)
of the period
Statement of changes in Equity
For the six months ended 31 January 2008
Capital
Redemption
Share Share Merger Revaluation Reserve Retained Total
Capital Premium Reserves Reserve Earnings Equity
Balance at 31
July 2007 119 1,248 712 366 5 (2,714) (264)
Profit for
the period 53 53
Movement in
share capital - - - - - - -
Balance at 31
January 2008 119 1,248 712 366 5 (2,661) (211)
ACCOUNTING POLICIES
The significant accounting policies, which have been consistently applied
in preparing the financial statements are as follows:
1 BASIS OF PREPARATION
The financial information set out in the interim report does not constitute
statutory accounts as defined in section 240 of the Companies Act 1985. The
Group's statutory financial statements for the year ended 31 July 2007 prepared
under UK GAAP, have been filed with the Registrar of Companies. The auditor's
report on those financial statements was unqualified and did not contain a
statement under Section 237(2) of the Companies Act 1985.
These interim financial statements are for the six months ended 31st
January 2008. They have been prepared in accordance with the requirements of
IFRS 1 "First-time Adoption of International Financial Reporting Standards"
relevant to interim reports, because they are part of the period covered by the
Group's first IFRS financial statements for the year ended 31 July 2008. They
do not include all of the information required for full annual financial
statements, and should be read in conjunction with the consolidated financial
statements for the year ended 31 July 2007.
These interim financial statements have been prepared under the historical
cost convention.
These interim financial statements have been prepared in accordance with
the accounting policies set out in the most recently available public
information, which are based on the recognition and measurement principles of
IFRS in issue as adopted by the European Union (EU) and are effective at 31 July
2008 or are expected to be adopted and effective at 31 July 2008, our first
annual reporting date at which we are required to use IFRS accounting standards
adopted by the EU.
Inspectron plc's consolidated financial statements were prepared in
accordance with United Kingdom Accounting Standards (United Kingdom Generally
Accepted Accounting Practice) until 31 July 2007. The date of transition to
IFRS was 1 August 2008. The disclosures required by IFRS 1 concerning the
transition from UK GAAP to IFRS are explained in note 5.
The accounting policies have been applied consistently throughout the Group
for the purposes of preparation of these interim financial statements.
BASIS OF CONSOLIDATION
The financial statements consolidate the results, cash flows and assets and
liabilities of the company and its wholly owned subsidiary undertakings.
2 TAXATION
Taxation charged for the period ended 31st January 2008 is calculated by
applying the directors' best estimate of the annual tax rate to the result for
the period.
3 SHARE CAPITAL
As at 31st January 2008, the company had an authorised share capital of
15,000,000 ordinary shares of 1p each, of which 11,890,904 had been issued and
were fully paid.
4 EARNINGS PER ORDINARY SHARE
The earnings per ordinary share has been calculated using the profit for
the period and the weighted average number of ordinary shares in issue during
the period as follows:
Six months to
31st January
2008
�'000
Profit for the period after taxation 53
Number
Basic weighted average of ordinary shares 11,890,904
of 1p each
Profit per share
Basic earnings (pence per share) .44
The basic earnings per share is calculated on the weighted average number
of shares in issue during the period.
The calculation for diluted and basic earnings per share are the same since
outstanding options (17,109 shares) had an excise price above the market price
at the balance sheet date and are therefore, in accordance with FRS 14, not
included in the diluted shares calculation.
5 EXPLANATION OF TRANSITION TO IFRS
As stated in the basis of preparation, these are the Group's first condensed
consolidated interim financial statements for part of the period covered by the
first IFRS annual consolidated financial statements prepared in accordance with
IFRS.
An explanation of how the transition from UK GAAP to IFRS has affected the
Group's financial position, financial performance and cash flows is set out
below.
Explanation of material adjustments to the cash flow statement:
Changes to the cashflow statement previously reported under UK GAAP are mainly
presentational. For the purpose of the cashflow statement, cash and cash
equivalents comprise cash on hand less overdrafts.
There have been no changes to the figures in the cashflow statement due to the
transition to IFRS.
Explanation of reconciliation from UK GAAP to IFRS for the balance sheet and
income statement:
The adoption of IFRS by the Group has resulted in some reordering of the
presentation of certain balances within both the income statement and balance
sheet.
There have been no changes to the figures in the balance sheet and income
statement due to the transition to IFRS.
6 COPIES OF THE INTERIM REPORT
Copies of the interim report will be sent to shareholders and are available at
the company's registered office: Apex House, West End, Frome, Somerset, BA11
3AS.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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