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Anite PLC  -  AIE   

Half Yearly Report

Released 07:00 04-Dec-2012

RNS Number : 6356S
Anite PLC
04 December 2012
 



 

 

Tuesday, 4 December 2012

ANITE PLC

Half year results for the six months ended 31 October 2012

 

Anite plc ("Anite" or "the Company" or "the Group"), the leading provider of software solutions to the international wireless and leisure travel industries, today announces its half year results for the six months ended 31 October 2012.

Financial highlights (adjusted) 1:

·      Revenue up 9% to £61.2m (2011: £56.2m)

·      Operating profit up 21% to £14.3m (2011: £11.8m)

·      Operating margin up 2.4% points to 23.4% (2011: 21.0%)

·      Profit before tax up 30% to £14.3m (2011: £11.0m)

·      Diluted earnings per share up 31% to 3.4p (2011: 2.6p)

·      Net cash of £16.8m (October 2011: £12.6m; April 2012: £16.9m)

·      Interim dividend up 53% to 0.575p per share (2011: 0.375p per share) 

 

 

·      Revenue from continuing operations of £61.2m (2011: £56.2m)

·      Operating profit from continuing operations of £11.3m (2011: £8.8m), after:

-      share based payments charge of £1.8m (2011: £1.0m)

-      amortisation of acquired intangible assets of £1.2m (2011: £2.0m)

·      Profit from continuing operations before tax of £11.3m (2011: £8.5m)

·      Profit for the period of £8.2m (2011: £6.0m)

·      Basic earnings per share 2.9p (2011: 2.1p); diluted earnings per share 2.7p (2011: 1.9p)

 

·      Group orders:

-      Closing order book £107.2m (31 October 2011: £92.5m; 30 April 2012: £114.5m) 

-      Order intake down 15% to £53.9m (2011: £63.8m) reflecting very strong comparative period

-      Book to bill ratio 0.9 (2011: 1.1)

·      Wireless: 

-      Strong demand in Handset Testing for Interoperability Testing and LTE 4G

-      Network Testing seeing growing momentum with Invex and LTE 4G products

·      Travel:

-      First Thomas Cook @com phase delivered and now live

-      £9m (2011: £8m) orders contracted for H2 delivery, and expanding order pipeline

 

·      Recent trends and the pipeline of existing growth opportunities, increase the Board's confidence that full year expectations will be met.

 

 

1Adjusted results are for continuing operations before share-based payments, amortisation of acquired intangible assets, other gains and losses and recycled hedge losses.

Christopher Humphrey, Chief Executive, said:

"Anite had a good first half with encouraging trading conditions in its markets despite the uncertain global economic backdrop.

"The range and potential of growth drivers are more varied and more balanced than they used to be. This is particularly so in Handset Testing, with significant opportunities over and above its original core market. It is also evident in Network Testing and Travel which have both substantially extended their footprints in recent years.

"We therefore have increasing confidence in our ability to deliver sustainable growth in the coming years."

 

 


 

www.anite.com

@AniteNews

Christopher Humphrey, Chief Executive

Richard Amos, Group Finance Director

01252 775200



020 3128 8100

Reg Hoare/Giles Robinson


 

An analysts' meeting will be held today at 9.15 for 9.30 a.m. at the London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS

Anite plc, an international software and solutions company, operates in two discrete markets: we provide device and network testing systems to the wireless market and reservation and e-commerce solutions to the leisure travel industry.  The success of both divisions is based on our comprehensive knowledge of the sectors and on our proprietary software and hardware products.

Our 530 staff work with the world's leading wireless and travel companies, from our headquarters in the UK and from offices in 15 countries throughout Europe, the Americas, Asia and the Middle East.

 

This interim statement contains forward-looking statements. These forward-looking statements are not guarantees of future performance. Rather, they are based on current views and assumptions and involve known and unknown risks, uncertainties and other factors that may cause actual results to differ from any future results or developments expressed or implied from the forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement and, save to the extent required by the applicable law or regulation, we do not undertake any obligation to update or renew any forward-looking statement.

 

 

 

  Half year results for the six months ended 31 October 2012

 

All references to adjusted profit relate to continuing operations for the period before share-based payments, amortisation of acquired intangible assets, other gains and losses and recycled hedge losses. See the attached income statement and notes for details. A reconciliation of adjusted results to reported statutory results is given in the Financial Review.

Anite performed well in the first half with encouraging trading conditions in its markets despite the difficult global economic backdrop.  Group revenue and adjusted operating profit were ahead of last year with overall results slightly ahead of Board expectations.

 

Growth drivers for the Wireless division, namely the increased market penetration of smartphones, mobile data growth and the roll out and complexity of mobile phone technology, remain undiminished.  We continue to invest in these areas developing new products and accessing adjacent markets.

 

Handset Testing achieved healthy double digit revenue and profit growth in the first half with strong demand for its Interoperability Testing and LTE 4G products.  This result was notable given the exceptionally strong comparative results for the same period in 2011.

 

In underlying constant currency terms, Network Testing achieved increased profit on flat revenue despite being impacted by demanding market conditions particularly in the early part of the period.  Translation of the underlying Euro denominated results back into Sterling was, however, affected by a 9% weakening in the Euro compared to the same period last year.  

 

Travel traded in line with the Board's expectations, reporting an encouraging, albeit small, increase in profits as it makes progress on delivering the major projects currently under contract.  The business retains a very strong order book and we continue to be encouraged by an expanding order pipeline.

Overall the Group's half year results were good with a 9% increase in revenue and 21% increase in adjusted operating profit.  

 

The Group's closing order book grew 16% year on year to £107.2m (31 October 2011: £92.5m; 30 April 2012: £114.5m).  This year on year increase included exceptional order intake in the second half of last year in Travel, which signed a number of large, multi-year orders.  Overall order intake in the six month period was, however, down 15% to £53.9m (2011: £63.8m) although Handset Testing order intake was 6% up year on year.  The overall reduction reflected significantly lower order intake in the period in Travel due to the nature of its pipeline (which features a number of large potential orders whose timing is unpredictable).

 

Revenue grew by 9% to £61.2m (2011: £56.2m) with Handset Testing the significant contributor to this growth as its revenue increased 17% to £40.5m (2011: £34.7m), a record first half performance. 

 

Adjusted operating profit was up 21% to £14.3m (2011: £11.8m) with increased adjusted operating margins reported by all businesses: 28% (2011: 26%) in Handset Testing, 22% (2011: 20%) in Network Testing and 19% (2011: 18%) in Travel.  Finance costs in this period were a net £nil (2011: £0.8m) following the repayment of outstanding term loans in November 2011 and adjusted profit before tax was £14.3m (2011: £11.0m).

 

Adjusted diluted earnings per share increased 31% to 3.4p (2011: 2.6p).

 

Anite has a strong balance sheet with net cash resources and financial flexibility provided by significant undrawn bank facilities.  Net cash as at 31 October 2012 was £16.8m (April 2012: £16.9m; October 2011: £12.6m), with cash generation consistent with usual seasonal patterns.  The Group has a revolving banking facility of £20m together with a £5m overdraft facility. Both facilities remained undrawn at 31 October 2012. 

Following the significant increase in dividend last year, the Board has stated that its policy is to increase future full year dividends broadly in line with earnings growth.  At the same time, this year we are aiming to re-align the balance between the interim and final dividend so payments are made in a more standard one third: two thirds split.

 

The Board is therefore declaring an interim dividend of 0.575p per share (2011: 0.375p per share). The 53% year on year growth this represents includes elements for both growth in earnings and for the rebalancing of the interim to final dividend ratio.  The dividend will be paid on 15 February 2013 to shareholders on the register at 25 January 2013.

The results for the first six months of the year, together with recent trends and the pipeline of potential new business, increase the Board's confidence that its full year expectations will be met.  Overall the Board expects that Group performance in the second half of the year will show an improvement both on the first half and on the same period last year.  It should however be noted that Group trading is typically biased towards the second half and that the Wireless businesses continue to operate with short sales pipeline visibility, whilst Travel orders tend to follow a lengthy sales cycle.

 

Travel's contracted order book of £9m for second half delivery provides support to repeat its first half financial performance.  Notwithstanding the sales timing risk that is ever present in this type of business, the pipeline of opportunities for new licence sales is underpinning expectations of period on period growth. 

 

We expect Network Testing to show growth in the second half as it maintains the progress demonstrated in the latter part of the recent half through the success of the Invex product, growing momentum with LTE 4G products and an improved product margin mix. Assuming no further weakening of the Euro, we expect the business to achieve its original full year expectation of mid-single digit profit growth.

 

The Board's expectations for second half Handset Testing performance are set in the context of its short pipeline visibility discussed above.  At this stage, we expect Handset Testing's second half performance will show healthy growth on both the first half and against the same period last year, consistent with achieving its full year expectations.  

 

Looking out further the Board is encouraged by developments in each part of the Group and the strong market position of each business.  The range and potential of growth drivers are more varied and more balanced than they used to be.  This is particularly so in Handset Testing, with significant opportunities over and above its original core market.  It is also evident in Network Testing and Travel which have both substantially extended their footprints in recent years.  We therefore have increasing confidence in our ability to deliver sustainable growth in the coming years.

Clay Brendish Chairman                                               Christopher Humphrey Chief Executive

 

 

 

Anite's operations comprise two divisions: Wireless and Travel.  The Wireless division is made up of two separately managed businesses: Handset Testing and Network Testing.

 

The overall results for the Group show a good performance in the first half of this year compared to the same period last year, especially in Handset Testing.

 

Wireless performance

Handset Testing

The results for the Handset Testing business for the period show that order intake increased by 6% to £37.4m (2011: £35.4m), revenue increased by 17% to £40.5m (2011: £34.7m) and adjusted operating profit increased by 27% to £11.4m (2011: £9.0m). The Board considers that this represents good progress by the Handset Testing business, particularly given the exceptional performance in the comparative period last year.

 

The first half of the year has seen a steady continuation of the trends seen over the recent past. Network operators continue to roll-out LTE 4G networks and there were 113 LTE 4G networks live by 31 October 2012, notably including the first commercial network in the UK.  Additionally, those operators who were early to roll-out, such as Verizon, continue to expand their network coverage and in response more manufacturers are launching more LTE 4G devices. As at 31 October 2012, there had been 61 LTE 4G compatible devices certified in 2012 in addition to the 10 certified in 2011. Most of these devices have been certified for the normal FDD variant of LTE 4G, but devices are starting to become available for the TD-LTE variant that will dominate in China and has additionally already been rolled out in Japan.

 

Increased LTE 4G revenue continued to be the main driver of Handset Testing growth, rising 29% to £20.2m in the period (2011: £15.6m), and now represents 50% of overall Handset Testing revenue.  Revenue for 2G/3G technologies also showed a 6% increase to £20.3m (2011: £19.1m). 

 

Revenue from Development Testing remained flat year on year whilst Conformance Testing revenue increased by 7% against what were exceptional increases last year.  Interoperability Testing is the other main driver of growth and it grew by 36%. It is an increasingly important part of the Handset Testing business now accounting for over 40% of its revenue. There is a trend for mobile operators to take stronger control of their supply chains to bring product to market quicker and identify faults earlier, so driving the growth in demand for testing in this area.

 

The key driver of growth for the Conformance Testing market is the increased adoption of new technology in the mobile phone network.  Growth in data and smartphones has increased the need for network operators to build extra speed and capacity into their networks.  This has caused the acceleration in the adoption of LTE 4G and the earlier development of LTE Advanced, the next step in the technology roadmap.  The growth drivers for Interoperability Testing are different from Conformance Testing and are derived from the growing complexity caused by numerous mobile phone technologies layering one upon another, together with the growing number of apps that are having a critical effect on the efficiency of the network.  These factors combined are having a significant effect on the customer's experience.  In order to tackle these problems network operators are requesting new Interoperability Testing systems tailored to test the weaker aspects of their individual network configuration.  Interoperability Testing adds another layer of quality assurance for the operator and importantly provides long term, sustainable growth for Anite.

 

Conformance Testing remains the core of the Handset Testing business.  Anite retains market leadership in LTE 4G conformance testing with over 400 validated test cases.  As anticipated, the gap between Anite and its competition is closing as the "FDD" variant of the LTE 4G standard becomes more developed.  However, Anite continues to lead the field in the CT TD-LTE market.  In addition, the Global TD-LTE Initiative (GTI), an industry taskforce, recently announced that Anite was the first vendor to achieve the validation targets for TD-LTE interoperability test cases for device functionality and performance testing.  Achieving this landmark target is important as it underlines Anite's leading position in developing mobile operator device acceptance test cases. Anite's progress will help device manufacturers accelerate the commercial roll-out of this technology.

 

Net revenue margin (revenue less third-party hardware cost) improved to 76% compared to 72% in the same period last year.  This was due to higher maintenance revenue, up 19% to £11.3m (2011: £9.5m) and an increased proportion of software sold in the period, up 25% to £19.4m (2011: £15.5m).

Investment in R&D has increased in the period as we continue the development of LTE 4G products to maintain technological leadership. R&D incurred in the period included investment in extending the capability of our LTE 4G platform to accommodate LTE Advanced functionality and also spending on further IOT opportunities.  The R&D charge to the income statement was £6.6m in the period (2011: £5.9m) including £1.0m amortisation of previously capitalised costs (2011: £0.6m).  An additional £1.4m of development cost was capitalised in the period (2011: £1.0m) reflecting investment incurred in maintaining market leadership in conformance and Interoperability test scripts.

 

Other fixed costs in Handset Testing have increased from £10.1m last year to £12.7m principally as a result of additional staffing in sales, customer support and development maintenance areas to support the increased size of the business and growing installed base of systems.  After fixed costs, net operating margin increased to 28% (2011: 26%).

 

The Handset Testing business is well positioned to continue to benefit from the opportunities LTE 4G is yielding with a broader range of products and further opportunities to develop gradually into adjacent market areas.

 

Network Testing

Network Testing order intake for the period was down 8% at £12.1m (2011: £13.1m) and revenue down 7% to £11.8m (2011: £12.7m) although adjusted operating profit was unchanged at £2.6m (2011: £2.6m).  These reported results for the period were, however, affected by a 9% period on period weakening in translating the Euro denominated results of the business back into Sterling.  Adjusting the performance in underlying Euro terms, order intake and revenue were up 1% and 2% respectively, with operating profit 10% ahead.

 

Market conditions for the Network Testing business remained challenging, particularly in the early part of the year.  The business, however, improved its performance in the latter part of the period, particularly through increased demand for the Invex benchmarking product (acquired in January 2011), revenue for which was significantly higher than in the comparative period.

Margins in the business were also strong with net revenue increasing from 70% to 72%, helped in part by an increased proportion of sales of higher margin in-house scanners and also by foreign exchange transactional benefits which yielded £0.3m as the business benefitted from its costs being mainly located in the relatively weak Euro-zone.

The income statement charge for investment in R&D in Network Testing remained at £1.8m (2011: £1.8m) including £0.1m amortisation of capitalised costs (2011: £0.1m).  In addition, £0.2m of R&D costs (2011: £0.3m) were capitalised in relation to the development of the benchmarking product.  Other fixed costs in Network Testing were down £0.1m in constant currency terms. Net operating margins in Network Testing increased to 22% (2011: 20%).

The Network Testing business is starting to see some initial benefit from the roll-out of LTE 4G networks, although this remains very much at an early stage.  We do not expect to see significant revenue from Network Testing LTE 4G tools until the next financial year, at which time, we expect the growth rate to be lower than we experienced in Handset Testing due to the typical pattern of investment in test tools by operators.

The Travel division traded in accordance with our expectations in the first half year.  Order intake in the period reduced as expected to £4.4m (2011: £15.3m) while revenue was marginally up at £8.9m (2011: £8.8m) and the adjusted operating profit up 6% at £1.7m (2011: £1.6m).  This profit performance is after the transaction effect of Euro currency fluctuations which, year on year, reduced profits by £0.4m.  The order book of contracted but undelivered revenue at the period end was £85.1m (30 April 2012: £89.6m, 31 October 2011: £69.7m).  Around £9m of the closing order book is expected to be delivered in the second half of the year, compared to about £8m at the same point last year.

During the first half of the year, Travel made good progress with the delivery and go-live of phase one of the @com system for Thomas Cook UK and Ireland.  Progress has also been made with TUI to implement @com into its UK mainstream business and on other smaller deployments.

The net revenue percentage in Travel reduced to 91% (2011: 97%) reflecting additional hardware/third party product sold in the period.  Travel's fixed costs reduced by £0.4m to £6.5m (2011: £6.9m) due to operating efficiencies compared to the prior period.  The fixed cost reduction, combined with incremental sales, resulted in net operating margins in Travel increasing to 19% (2011: 18%).

The Travel business has an encouraging level of contracted orders for delivery in the second half and a strong pipeline of sales prospects.  These provide the opportunity for the business to develop increased levels of recurring revenues, a sustainable business model and growth in the long term.

 

Revenue

Revenue from continuing operations was up 9% at £61.2m (2011: £56.2m).  Geographically, revenue by destination was: United Kingdom 13% (2011: 12%); other Europe, Middle East & Africa 25% (2011: 28%); the Americas 30% (2011: 35%); and Asia & Rest of World 32% (2011: 25%).  The growth in the latter segment was partly achieved in India where tier one device and chipsetmanufacturers are investing significantly in R&D facilities.

 

Reconciliations of Adjusted and Statutory Profits

Reconciliations of adjusted EBITDA of £17.2m to the operating profit of £11.3m and adjusted operating profit of £14.3m to the reported profit before tax for the year of £11.3m are set out in the tables below.  The reconciling items are those that, in the opinion of the Board, are either one-off in nature or are non-cash related and are not therefore indicative of the Group's underlying trading.

Half year ended 31 October:

2012

2011


£m

£m

Adjusted EBITDA

17.2

14.2

Depreciation

(1.6)

(1.5)

Amortisation of intangible assets

(1.3)

(0.9)

Adjusted operating profit

14.3

11.8

Share-based payments

(1.8)

(1.0)

Amortisation of acquired intangible assets

(1.2)

(2.0)

Operating profit

11.3

8.8

 

Half year ended 31 October:

2012

2011


£m

£m

Adjusted operating profit

14.3

11.8

Net finance charges before recycled hedge losses

-

(0.8)

Adjusted profit before tax

14.3

11.0

Share-based payments

(1.8)

(1.0)

Amortisation of acquired intangible assets

(1.2)

(2.0)

Other gains and losses

-

0.5

Profit from continuing operations before tax

11.3

8.5

 

Currency effects 

The average exchange rates, half year on half year, for the US Dollar strengthened against Sterling from £1=US$1.61 to £1=US$1.58, and for the Euro weakened from £1=€1.14 to £1=€1.25.  The closing exchange rate for the Euro weakened against Sterling to £1=€1.24 (April 2012: £1=€1.23) and the closing exchange rate for the US Dollar strengthened to £1=US$1.61 (April 2012: £1=US$1.63).

 

The net effect of these changes on the translation of results from overseas subsidiaries was to reduce revenue by £1.0m and profits by £0.3m.  Adjusting for these impacts, the underlying growth in revenue was 11% and in operating profit 24%.  Network Testing was the main business impacted by these translational changes.  In addition the effect of trading in foreign currencies resulted in transaction losses of £0.3m making the total adverse effect of currency fluctuations on profits £0.6m year on year of which £0.2m was in the Handset Testing business and £0.4m in the Travel business.

 

Cost of sales

Cost of sales increased 8%, slightly less than the growth in revenue, and gross profit increased slightly to 59% (2011: 58%).  Within cost of sales hardware/third party costs were unchanged at £13.9m (2011: £13.9m).  Other cost of sales increased by 18% to £11.4m (2011: £9.6m) and was due to the increase in staff and other costs directly associated with the delivery of revenue and to support the growing number of installed systems in the Handset Testing business.

Operating expenses

Total operating expenses in the period increased to £24.6m (2011: £23.9m).  A detailed breakdown is given in note 2.3.

 

Within total operating expenses are one-off and non-cash items not charged to adjusted operating profit and underlying operating expenses that are charged to adjusted operating profit.  The latter increased to £21.6m (2011: £20.9m), mainly due to increased R&D (£0.7m) in the Handset Testing business.

 

During the period, unallocated Group corporate costs remained unchanged at £1.4m (2011: £1.4m).

 

After the underlying operating expenses, adjusted operating profit increased by 21% to £14.3m (2011: £11.8m).  Adjusted EBITDA was up 21% at £17.2m (2011: £14.2m).

 

One-off and non-cash expenses excluded from adjusted profit calculations totalled £3.0m (2011: £3.0m).  This included amortisation of acquired intangible assets of £1.2m (2011: £2.0m) and a share-based payments charge of £1.8m (2011: £1.0m).  After these non-operational costs, the Group reported an overall operating profit of £11.3m (2011: operating profit of £8.8m).

 

Group finance costs

The Group incurred net £nil finance charges in the period (2011: £0.8m).  The reduction follows the settlement in 2011 of the Group's swap and term loan liabilities.  The Group had no borrowings at 31 October 2012.

 

Taxation

The tax charge for the period on continuing operations was £3.1m (2011: £2.6m).  The tax rate on the statutory operating profit was 27.2% (2011: 30.2%).  The underlying tax rate on adjusted profit before tax was 27.0% (2011: 28.5%).  Tax paid in the period was £3.0m (2011: £1.5m).

 

Earnings per share

After taking account of the factors described above, adjusted basic earnings per share increased 32% to 3.7p (2011: 2.8p), adjusted diluted earnings per share increased 31% to 3.4p (2011: 2.6p).  The overall basic earnings per share for continuing operations was 2.9p (2011: 2.1p).

 

Cash generated from operating activities was £10.7m (2011: £14.8m).  This represented a conversion of 75% of adjusted profit before tax (2011: 125%).  The reduction resulted from a £5.1m movement in working capital in the period reflecting the increased receivables at the period end coupled with the creditor payments made early in the period in respect of inventory built up at the end of the last financial year to meet the requirements of the additional business in Handset Testing.

 

Capital expenditure in the period was £2.5m (2011: £1.9m) principally on software licences (£0.3m) and LTE 4G sales demonstration and development systems for the Handset Testing business.  A further £1.6m was incurred on capitalised development expenditure (2011: £1.3m), which represented the cost of writing conformance and interoperability test cases for Handset Testing's LTE 4G product and development of the benchmarking product in Network Testing.

 

Dividends paid in the period were £3.2m (2011: £2.1m) and a net £0.5m was incurred on buying shares for the Employee Benefit Trust (2011: £0.7m).  After these movements and the effect of currency exchange rates, net cash decreased by £0.1m (2011: net cash decrease of £15.1m following the settlement of the cross currency swap and repayment of term loan in 2011).

 

At 31 October 2012 the Group had net cash of £16.8m (31 October 2011: £12.6m; 30 April 2012: £16.9m).  The Group had no net borrowings at 31 October 2012 (31 October 2011: net borrowings £10.0m; 30 April 2012: £nil).The Group has a revolving credit facility of £20.0m at 31 October 2012 (30 October 2011: £20.0m; 30 April 2012: £20.0m) together with a net overdraft facility of £5.0m (31 October 2011: £5.0m; 30 April 2012: £5.0m).  Both these facilities were undrawn at 31 October 2012.

Key risks and uncertainties, going concern and Statement of Directors' Responsibilities

 

Risks and uncertainties

There are a number of potential risks and uncertainties which could have a material impact on the Group's performance over the remaining six months of the financial year and could cause actual results to differ materially from expected and historical results.

 

These risks include:

 

·      Global economic and geo-political risks

·      Competitiveness

·      Technology risks

·      Project delivery risks

·      Reliance on major customers

·      Human resource and organisation risks; and

·      Financial risks

 

The directors do not consider that the principal risks and uncertainties have changed since the publication of the annual report for the year ended 30 April 2012.  A detailed explanation of these risks is set out on pages 31 to 33 of the annual report, which is available at www.anite.com.

 

Any forward-looking statements made within this interim half year report have been made in good faith by the Directors based on the information made available up to the date of the Directors' approval of this report.  These forward-looking statements should be treated with caution due to the inherent uncertainties, including macro-economic, IT service and solution market uncertainties and business risk factors which may affect the outcome.

 

In considering going concern and liquidity risk, the Directors have reviewed the Group's future cash requirements and earnings projections for the next two financial years.  The Directors believe these forecasts, which show the Group being covenant compliant for the foreseeable future, have been prepared on a prudent basis and have also considered the impact of a range of reasonably possible changes to trading performance. The Directors have concluded that given these circumstances, together with the significant cash balances and unused loan facilities, it is appropriate to prepare the financial statements of the Group on a going concern basis.

 

Statement of Directors' responsibilities

The Directors confirm that to the best of their knowledge:

 

·      The condensed set of financial statements has been prepared in accordance with IAS 34;

·      The interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and

·      The interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).

 

 

 

 

By order of the Board

Richard Amos

Group Finance Director and Company Secretary

3 December 2012

 

 

 

INDEPENDENT REVIEW REPORT TO ANITE PLC

 

We have been engaged by the company to review the condensed consolidated set of financial statements in the half-yearly financial report for the six months ended 31 October 2012 which comprises the condensed consolidated income statement, the condensed consolidated statement of comprehensive income, the condensed consolidated statement of changes in equity, the condensed consolidated balance sheet, and the condensed consolidated cash flow statement and related notes 1 to 12.  We have read the other information contained in the half-yearly financial report 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 in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board.  Our work has been undertaken so that we might state to the company those matters we are required to state to it 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, for our review work, for this report, or for the conclusions 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 Services Authority.

 

As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs 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 to the Company 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" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making inquiries, 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 Ireland) 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.

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 31 October 2012 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.

 

 

Deloitte LLP

Chartered Accountants and Statutory Auditor

London, United Kingdom

3 December 2012

 

Condensed consolidated income statement

 



Six months ended

31 October 2012

Six months ended

31 October 2011

Year 

ended

30 April

2012



(unaudited)

(unaudited)

(audited)


Note

£000

£000

£000

Continuing operations





Revenue

2.1

61,184

56,242

122,546

Cost of sales


(25,265)

(23,496)

(50,105)

Gross profit


35,919

32,746

72,441

Distribution costs


(5,987)

(6,223)

(12,463)

Research and development


(8,578)

(8,554)

(17,096)

Administrative expenses


(10,023)

(9,168)

(20,383)

Operating expenses

2.3

(24,588)

(23,945)

(49,942)

Operating profit before share-based payments, amortisation of acquired intangible assets and restructuring costs


14,303

11,751

28,772

Share-based payments

3

(1,766)

(980)

(2,889)

Amortisation of acquired intangible assets


(1,206)

(1,970)

(3,340)

Restructuring costs


-

-

(44)

Operating profit


11,331

8,801

22,499

Other gains and losses


-

487

487

Finance income

4

59

266

353

Finance charges

4

(104)

(1,025)

(1,152)

Profit from continuing operations before tax


11,286

8,529

22,187

Tax expense

5

(3,070)

(2,574)

(5,974)

Profit from continuing operations


8,216

5,955

16,213

Profit from discontinued operations

5

-

-

2,253

Profit for the period - attributable to equity holders of the parent


8,216

5,955

18,466











Continuing and discontinued operations





Earnings per share - basic

6

2.9p

2.1p

6.5p

                               - diluted


2.7p

1.9p

6.0p

Continuing operations





Earnings per share - basic

6

2.9p

2.1p

5.7p

                                - diluted


2.7p

1.9p

5.3p

 

 

Condensed consolidated statement of comprehensive income



Six months ended

31 October 2012

Six months ended

31 October 2011

Year 

ended

30 April

2012



(unaudited)

(unaudited)

(audited)


Note

£000

£000

£000






Retained profit for the period


8,216

5,955

18,466

Exchange differences arising on translation of foreign operations


(697)

(1,178)

(6,745)

Cash flow hedges


-

237

237

Recycling of fair value loss on cash flow hedges from equity to profit or loss1


-

42

42

Tax credit / (charge) taken directly to other comprehensive income

5

31

50

(193)

Total comprehensive income


7,550

5,106

11,807

 

1  The fair value losses recycled to the income statement are disclosed within finance charges (note 4).

 

 

Condensed consolidated statement of changes in equity


Issued

share

capital

Share

premium

account

Own

shares

Merger

reserve

Capital

redemption

reserve

Other

reserves

Retained

earnings

Total


£000

£000

£000

£000

£000

£000

£000

£000

 

Balance at 1 May 2011

Changes in equity for the period to 31 October 2011

 

33,680

 

25,560

 

(9,229)

 

722

 

2,741

 

(4,829)

 

33,055

 

81,700

Total comprehensive income for the period

-

-

-

-

-

(849)

5,955

5,106

Issue of share capital

2

7

-

-

-

-

-

9

Purchase of own shares into employee benefit trust

-

-

(673)

-

-

-

-

(673)

Gain on sale of shares from employee benefit trust

-

-

752

-

-

-

(749)

3

Recognition of equity-settled share-based payments after tax

-

-

-

-

-

-

705

705

Dividend paid

-

-

-

-

-

-

(2,103)

(2,103)

Balance at 31 October 2011 (unaudited)

33,682

25,567

(9,150)

722

2,741

(5,678)

36,863

84,747

 

Changes in equity for the period to 30 April 2012









Total comprehensive income for the period

-

-

-

-

-

(5,810)

12,511

6,701

Issue of share capital

20

61

-

-

-

-

-

81

Purchase of own shares into employee benefit trust

-

-

(955)

-

-

-

-

(955)

Gain on sale of shares from employee benefit trust

-

-

123

-

-

-

(122)

1

Recognition of equity-settled share-based payments after tax

-

-

-

-

-

-

2,594

2,594

Dividend paid

-

-

-

-

-

-

(1,068)

(1,068)

Balance at 30 April 2012 (audited)

33,702

25,628

(9,982)

722

2,741

(11,488)

50,778

92,101

 

Changes in equity for the period to 31 October 2012









Total comprehensive income for the period

-

-

-

-

-

(666)

8,216

7,550

Issue of share capital

25

31

-

-

-

-

-

56

Purchase of own shares into employee benefit trust

-

-

(874)

-

-

-

-

(874)

Gain on sale of shares from employee benefit trust

-

-

1,506

-

-

-

(1,159)

347

Recognition of equity-settled share-based payments after tax

-

-

-

-

-

-

1,713

1,713

Dividend paid

-

-

-

-

-

-

(3,233)

(3,233)

Balance at 31 October 2012 (unaudited)

33,727

25,659

(9,350)

722

2,741

(12,154)

56,315

97,660

 

 

Condensed consolidated balance sheet

 



31 October 2012

31 October 2011

30 April

2012



(unaudited)

(unaudited)

(audited)


Note

£000

£000

£000

Non-current assets





Goodwill


53,699

57,953

54,280

Other intangible assets


15,114

17,740

15,892

Property, plant and equipment


11,962

9,420

10,967

Deferred tax assets


4,898

2,613

4,489



85,673

87,726

85,628

Current assets





Inventories


10,321

7,098

10,195

Trade and other receivables


35,389

29,443

32,856

Derivative financial assets


53

224

92

Current tax assets


232

811

157

Cash and cash equivalents

7

16,832

22,632

16,947



62,827

60,208

60,247

Total assets


148,500

147,934

145,875






Current liabilities





Trade and other payables


(36,425)

(32,476)

(37,741)

Bank borrowings

7

-

(10,000)

-

Current tax payable


(7,793)

(10,490)

(7,666)

Derivative financial liabilities


(22)

-

-

Provisions


(3,457)

(5,423)

(4,899)



(47,697)

(58,389)

(50,306)

Non-current liabilities





Deferred tax liabilities


(2,095)

(3,045)

(2,527)

Provisions


(1,048)

(1,753)

(941)



(3,143)

(4,798)

(3,468)

Total liabilities


(50,840)

(63,187)

(53,774)






Net assets


97,660

84,747

92,101






Equity





Issued share capital

8

33,727

33,682

33,702

Share premium account


25,659

25,567

25,628

Own shares


(9,350)

(9,150)

(9,982)

Merger reserve


722

722

722

Capital redemption reserve


2,741

2,741

2,741

Other reserves


(12,154)

(5,678)

(11,488)

Retained earnings


56,315

36,863

50,778

Total equity


97,660

84,747

92,101

 

The accompanying notes are an integral part of this consolidated balance sheet

 

 

Condensed consolidated cash flow statement

 



Six months ended

31 October 2012

Six months ended

31 October 2011

Year 

ended

30 April

2012



(unaudited)

(unaudited)

(audited)


Note

£000

£000

£000

 






 

Profit for the period





 

Continuing operations

8,216

5,955

16,213

 

Discontinued operations

-

-

2,253

 



8,216

5,955

18,466

 

Adjustments for:





 

Tax charge - continuing and discontinued

5

3,070

2,574

3,721

 

Other (gains) and losses


-

(487)

(487)

 

Net finance charges

4

45

759

799

 

Depreciation property, plant and equipment


1,547

1,479

3,280

 

Amortisation of intangible assets


1,337

958

2,154

 

Amortisation of acquired intangible assets


1,206

1,970

3,340

 

Profit on disposal of property, plant and equipment


-

-

(74)

 

Share-based payments charge

3

1,766

980

2,889

 

Decrease in provisions


(1,356)

(1,124)

(1,907)

 

Operating cash flows before movements in working capital


15,831

13,064

32,181

 

Increase in inventories


(126)

(2,376)

(5,473)

 

(Increase)/decrease in receivables


(2,534)

2,497

(894)

 

(Decrease)/Increase in payables


(2,457)

1,579

5,160

 

Movements in working capital


(5,117)

1,700

(1,207)

 

Cash generated from operations


10,714

14,764

30,974

 

Interest received


47

473

509

 

Interest paid


(89)

(1,154)

(1,381)

 

Income taxes paid


(3,033)

(1,516)

(5,413)

 

Net cash generated from operating activities


7,639

12,567

24,689

 

Cash flow from investing activities





 

Settlement of cross-currency swap


-

(21,590)

(21,591)

 

Purchase of product line and deferred consideration paid


-

(33)

(622)

 

Purchase of property, plant and equipment


(2,207)

(1,548)

(4,952)

 

Proceeds from sale of property, plant and equipment


-

-

76

 

Purchase of software licences


(319)

(294)

(697)

 

Expenditure on capitalised product development


(1,604)

(1,343)

(2,629)

 

Net cash used in investing activities


(4,130)

(24,808)

(30,415)

 

Cash flow from financing activities





 

Issue of ordinary share capital


56

9

90

 

Purchase of own shares into employee benefit trust


(874)

(673)

(1,628)

 

Proceeds from employee SAYE scheme to purchase shares from employee benefit trust


347

3

4

 

Dividend paid to Company's shareholders


(3,233)

(2,103)

(3,171)

 

Repayment of bank loans


-

-

(10,000)

 

Net cash used in financing activities


(3,704)

(2,764)

(14,705)

 

Net decrease in cash and cash equivalents


(195)

(15,005)

(20,431)

 

Effect of exchange rate changes


80

(30)

(289)

 

Cash and cash equivalents at beginning of period


16,947

37,667

37,667

 

Cash and cash equivalents at end of period

7

16,832

22,632

16,947

 

 

 

1BASIS OF PREPARATION AND accounting policies

The unaudited condensed consolidated financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRS) as adopted by the European Union and in accordance with International Accounting Standard (IAS) 34: 'Interim Financial Reporting'.

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in preparation of the Group's annual financial statements for the year ended 30 April 2012 as available on our website www.anite.com.

1.1  Information regarding future accounting standards

There are no new standards or improvements to existing standards that are mandatory for the first time in the Group's accounting period beginning on 1 May 2012 and no new standards have been early adopted. The Group's October 2012 Interim Report has adopted the following amendments to IFRS with no significant impact on the Group's financial performance or position:

IFRS 7 "Financial Instruments: Disclosures"

IAS 12 "Deferred Tax: Recovery of Underlying Assets"

IFRS 1 "Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters"

 

1.2  Other information

The financial information contained in this Interim Report does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The financial information contained in this Interim Report has been reviewed by the auditors but not audited.

The figures for the year ended 30 April 2012 do not constitute the statutory accounts for that period but are based upon the Group's audited accounts prepared under IFRS. The statutory accounts for the year ended 30 April 2012 have been delivered to the Registrar of Companies. The auditor's report on those accounts was unqualified and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.

On 3 December 2012, this unaudited Interim Report was approved by the Board of Directors for issue.

 

2 Revenue and segmental information

2.1Revenue from operations



Six months ended

 31 October 2012

Six months ended

 31 October 2011

Year  ended

 30 April 2012


Note

£000

£000

£000






Own product software licences


26,588

23,168

52,561

Hardware and other third-party product


14,112

14,427

30,959

Bespoke services, systems integration and implementation of software products


3,131

3,788

7,908

Managed services


2,451

2,219

4,552

Software maintenance and support


14,902

12,640

26,566

Revenue from operations

2.2

61,184

56,242

122,546

Finance income

4

59

266

353

Total revenue


61,243

56,508

122,899

 

2.2 Operating segments - primary basis

The Group is organised into four operating segments: Handset Testing; Network Testing; Travel and Group. With the exception of Group, which performs the head office function, each operating segment derives its revenue from the development, installation and support of products, mainly software, relating to its relevant industry sector.

Operating segment information under the primary reporting format is as disclosed in the tables below:


Handset

Testing

Network

Testing

Total Wireless

Travel

Group

Total

Six months ended 31 October 2012

£000

£000

£000

£000

£000

£000








External revenue

40,491

11,802

52,293

8,891

-

61,184

Internal revenue

-

-

-

-

1,027

1,027

Total revenue

40,491

11,802

52,293

8,891

1,027

62,211

Segment adjusted1 profit / (loss) before tax

11,435

2,561

13,996

1,661

(1,399)

14,258

Net finance charges

-

-

-

-

45

45

Segment adjusted1 operating profit / (loss)

11,435

2,561

13,996

1,661

(1,354)

14,303

Share-based payments

(408)

(100)

(508)

(146)

(1,112)

(1,766)

Amortisation of acquired intangible assets

-

(1,206)

(1,206)

-

-

(1,206)

Segment operating profit / (loss)

11,027

1,255

12,282

1,515

(2,466)

11,331

Finance income

-

-

-

-

59

59

Finance charges

-

-

-

-

(104)

(104)

Profit / (loss) from continuing operations before tax

11,027

1,255

12,282

1,515

(2,511)

11,286

Tax expense

-

-

-

-

(3,070)

(3,070)

Profit / (loss) from continuing operations

11,027

1,255

12,282

1,515

(5,581)

8,216

Profit from discontinued operations

-

-

-

-

-

-

Profit / (loss) for the period

11,027

1,255

12,282

1,515

(5,581)

8,216








Segment total assets

41,294

69,805

111,099

14,725

22,676

148,500








1 Profit / (loss) from continuing operations before share-based payments and amortisation of acquired intangible assets

 

2.2 Operating segments - primary basis (continued)

 


Handset

Testing

Network

Testing

Total Wireless

Travel

Group

Total

Six months ended 31 October 2011

£000

£000

£000

£000

£000

£000








External revenue

34,725

12,718

47,443

8,799

-

56,242

Internal revenue

-

-

-

-

850

850

Total revenue

34,725

12,718

47,443

8,799

850

57,092

Segment adjusted1 profit / (loss) before tax

9,011

2,575

11,586

1,561

(2,113)

11,034

Net finance charges before recycled hedge loss

-

-

-

-

717

717

Segment adjusted1 operating profit / (loss)

9,011

2,575

11,586

1,561

(1,396)

11,751

Share-based payments

(359)

(89)

(448)

39

(571)

(980)

Amortisation of acquired intangible assets

-

(1,970)

(1,970)

-

-

(1,970)

Segment operating profit / (loss)

8,652

516

9,168

1,600

(1,967)

8,801

Other gains and losses

-

-

-

-

487

487

Finance income

-

-

-

-

266

266

Finance charges

-

-

-

-

(1,025)

(1,025)

Profit / (loss) from continuing operations before tax

8,652

516

9,168

1,600

(2,239)

8,529

Tax expense

-

-

-

-

(2,574)

(2,574)

Profit / (loss) from continuing operations

8,652

516

9,168

1,600

(4,813)

5,955

Profit from discontinued operations

-

-

-

-

-

-

Profit / (loss) for the period

8,652

516

9,168

1,600

(4,813)

5,955








Segment total assets

29,655

77,760

107,415

11,612

28,907

147,934








1 Profit / (loss) from continuing operations before share-based payments, amortisation of acquired intangible assets, other gains and losses and recycled hedge losses

 

2.2 Operating segments - primary basis (continued)

 


Handset

Testing

Network

Testing

Total Wireless

Travel

Group

Total

Year ended 30 April 2012

£000

£000

£000

£000

£000

£000








External revenue

76,423

26,044

102,467

20,079

-

122,546

Internal revenue

-

-

-

-

1,583

1,583

Total revenue

76,423

26,044

102,467

20,079

1,583

124,129

Segment adjusted1 profit / (loss) before tax

21,458

5,311

26,769

4,622

(3,376)

28,015

Net finance charges before recycled hedge loss

-

-

-

-

757

757

Segment adjusted1 operating profit / (loss)

21,458

5,311

26,769

4,622

(2,619)

28,772

Share-based payments

(695)

(36)

(731)

69

(2,227)

(2,889)

Amortisation of acquired intangible assets

-

(3,340)

(3,340)

-

-

(3,340)

Restructuring costs

-

-

-

-

(44)

(44)

Segment operating profit / (loss)

20,763

1,935

22,698

4,691

(4,890)

22,499

Other gains and losses

-

-

-

-

487

487

Finance income

-

-

-

-

353

353

Finance charges

-

-

-

-

(1,152)

(1,152)

Profit / (loss) from continuing operations before tax

20,763

1,935

22,698

4,691

(5,202)

22,187

Tax expense

-

-

-

-

(5,974)

(5,974)

Profit / (loss) from continuing operations

20,763

1,935

22,698

4,691

(11,176)

16,213

Profit from discontinued operations

-

-

-

-

2,253

2,253

Profit / (loss) for the period

20,763

1,935

22,698

4,691

(8,923)

18,466








Segment total assets

38,599

61,687

100,286

11,700

33,889

145,875








1 Profit / (loss) from continuing operations before share-based payments, amortisation of acquired intangible assets, restructuring costs, other gains and losses and recycled hedge losses

2.3 Operating expenses


Six months ended

 31 October 2012

Six months ended

 31 October 2011

Year

 ended

30 April 2012


£000

£000

£000

Distribution costs




- amortisation of acquired intangible assets

1,041

1,141

2,243

- other underlying operating expenses

4,946

5,082

10,220


5,987

6,223

12,463

Research and development




- amortisation of internally generated assets

1,074

714

1,622

- other underlying operating expenses

7,339

7,011

14,377


8,413

7,725

15,999

- amortisation of acquired intangible assets

165

829

1,097


8,578

8,554

17,096

Administrative expenses




- share-based payments

1,766

980

2,889

- restructuring costs

-

-

44

- other underlying operating expenses

8,257

8,188

17,450


10,023

9,168

20,383

Total operating expenses

24,588

23,945

49,942





Analysed as:




- amortisation of acquired intangible assets

1,206

1,970

3,340

- restructuring costs

-

-

44

- share-based payments

1,766

980

2,889

One-off and non-trading operating expenses excluded from adjusted profit

2,972

2,950

6,273

- amortisation of internally generated assets

1,074

714

1,622

- other underlying operating expenses

20,542

20,281

42,047

Total operating expenses

24,588

23,945

49,942

 

 

3 SHARE-BASED PAYMENTS


Six months ended

31 October 2012

Six months ended

31 October 2011

Year

 ended

30 April 2012


£000

£000

£000





Equity settled

1,176

705

1,481

Cash settled

590

275

1,408

Share-based payments charge

1,766

980

2,889

 

The Group does not operate separate cash-settled share-based payment arrangements; however, the employer's NIC liability arising on the outstanding awards is treated as such an arrangement for accounting purposes.

 

4 Net finance charge


Six months ended

31 October 2012

Six months ended

31 October 2011

Year

 ended

30 April 2012


£000

£000

£000

Finance income




Interest receivable and similar income

1

2

26

Interest on short-term deposits

24

215

237

Interest on extended payment terms

34

49

90

Total finance income

59

266

353





Finance charges




Bank loans and overdrafts

-

(78)

(84)

Other loans/commitment fees

(83)

(29)

(106)

Losses on financial instruments in a hedging relationship:




- Interest rate swaps and caps - cash flow hedges

-

(478)

(478)

- Cross currency swaps - net investment hedge

-

(347)

(347)

Other interest

-

-

(3)

Unwinding of discount on provisions 1

(21)

(51)

(92)

Finance charges before recycled hedge loss

(104)

(983)

(1,110)

Recycling of fair value loss on cash flow hedges 2

-

(42)

(42)

Total finance charges

(104)

(1,025)

(1,152)









Adjusted net finance charge before recycled hedge loss

(45)

(717)

(757)

Recycling of fair value loss on cash flow hedges 2

-

(42)

(42)





Net finance charge

(45)

(759)

(799)

1  The unwinding of discount on provisions relates to property and deferred consideration provisions.

2  The recycling of fair value loss on cash flow hedges arose due to the future repayments of the term loan reducing the interest payments causing some of the interest cash flows to be classed as no longer probable. In accordance with IAS 39, an equivalent proportion of the fair value losses under the interest rate swap arrangement, previously taken to equity, was released to profit and loss.

 

5 tax expense

Continuing operations

Six months ended

31 October 2012

Six months ended

31 October 2011

Year

 ended

30 April

2012


£000

£000

£000

Current tax




UK corporation tax

2,128

1,592

4,071

Foreign tax

1,391

1,571

2,774


3,519

3,163

6,845

Adjustments in respect of prior years




UK corporation tax

-

-

86


-

-

86

Total current tax expense

3,519

3,163

6,931

Deferred tax




UK

(48)

(123)

(180)

Foreign

(401)

(466)

(777)

Total deferred tax expense / (credit)

(449)

(589)

(957)

Total income tax expense

3,070

2,574

5,974

 

Income tax for the interim period is charged at 27.0% (October 2011: 28.5%), representing the weighted average of the estimated annual effective income tax rate expected to apply to adjusted profit for the full year in each jurisdiction and major category of income within continuing operations.  The equivalent weighted average rate on the statutory profit is 27.2% (October 2011: 30.2%).

 

Discontinued operations

Six months ended

31 October 2012

Six months ended

31 October 2011

Year

 ended

30 April

2012


£000

£000

£000

Current tax - Adjustments in respect of prior years




UK corporation tax

-

-

(2,253)





Total income tax credit

-

-

(2,253)

 

 

Tax (credit) / charge taken to equity

Six months ended

31 October 2012

Six months ended

31 October 2011

Year

 ended

30 April

2012


£000

£000

£000

Deferred tax relating to the translation adjustment to amortisation of acquired intangible assets

(31)

(50)

(257)

UK corporation tax relating to foreign exchange

-

-

450

Income tax relating to components of other comprehensive income

(31)

(50)

193

Tax relating to share-based payments

(536)

-

(1,818)

Total tax credit taken directly to equity

(567)

(50)

(1,625)

 

6 Earnings per share

The calculations of earnings per share are based on the Group profit for the period, adjusted profit1 and weighted average number of shares in issue:

 



Basic



Diluted



Six months ended

31 October 2012

Six months ended

31October 2011

Year  ended

30 April

 2012

Six months ended

31 October 2012

Six months ended 31 October 2011

Year  ended 30 April 2012

EPS summary







Basic EPS

2.9p

2.1p

6.5p

2.7p

1.9p

6.0p

Basic EPS for continuing operations

2.9p

2.1p

5.7p

2.7p

1.9p

5.3p

Adjusted EPS2

3.7p

2.8p

7.2p

3.4p

2.6p

6.7p









Six months ended

31 October 2012

Six months ended

31October 2011

Year  ended

30 April

 2012

Six months ended

31 October 2012

Six months ended

31October 2011

Year  ended 30 April 2012


Pence per share

Pence per share

Pence per share

 

£000

 

£000

 

£000

Profit for the period

2.9

2.1

6.5

8,216

5,955

18,466

Profit from discontinued operations

-

-

(0.8)

-

-

(2,253)

Profit for the period on continuing operations

2.9

2.1

5.7

8,216

5,955

16,213

Reconciliation to adjusted profit:







Other gains and losses (net of tax)

-

(0.1)

(0.1)

-

(361)

(361)

Recycled hedge losses (net of tax)

-

-

-

-

31

31

Amortisation of acquired intangible assets (net of tax)

0.3

0.5

0.9

763

1,504

2,472

Share-based payments (net of tax)

0.5

0.3

0.7

1,425

763

2,103

Restructuring costs (net of tax)

-

-

-

-

-

32

Adjusted profit1

3.7

2.8

7.2

10,404

7,892

20,490

1  Profit from continuing businesses before other gains and losses, recycled hedge losses, amortisation of acquired intangible assets, share-based payments and restructuring costs.

2  Earnings per share on adjusted profit1 have been included to give a clearer understanding of the results of the continuing businesses.

 

 

Number of shares ('000)

Six months ended

31 October 2012

Six months ended

31 October 2011

Year

 ended

30 April

2012

Weighted average number of shares in issue - used to calculate basic earnings per share

284,009

283,902

283,597

Effect of potentially dilutive ordinary shares




- SAYE and share option schemes

24,034

24,562

24,255

Number of shares used to calculate diluted earnings per share

308,043

308,464

307,852

 

 

7 Net CASH


31 October 2012

31 October 2011

30 April 2012


£000

£000

£000

Cash and cash equivalents

16,832

22,632

16,947

Bank borrowings - current

-

(10,000)

-

Net cash

16,832

12,632

16,947

 

 

8 share capital


Ordinary shares

of 11.25p each

Deferred

redeemable shares

of £1 each




Number

£000

Number

£000

Allotted, issued and fully paid:





At 1 May 2012

299,131,879

33,652

50,000

50

Issued during the period

220,941

25

-

-

At 31 October 2012

299,352,820

33,677

50,000

50

 

9 Dividends

The Company paid a final dividend of 1.125p (2011: 0.735p) per share, totalling £3,233,342 (2011: £2,102,975) on 23 October 2012.

10 Contingent liabilities

There are contingent liabilities that arise in the normal course of business in respect of indemnities, warranties, guarantees and legal claims. However, the Directors consider that none of these claims is expected to result in a material loss to the Group. There has been no change in the Directors' assumptions in regard to contingent liabilities since 30 April 2012.

11 RELATED PARTIES

Transactions between the company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.  There have been no material related party transactions in the period.

12 POST BALANCE SHEET EVENTS

There have been no material events post the balance sheet date that require disclosure.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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