ACC.L Regulatory News (ACC)

6 Jul 2005 07:00

Access Intelligence PLC06 July 2005 FOR RELEASE 7.00AM 6 JULY 2005 ACCESS INTELLIGENCE PLC (Range of companies providing information, advice and services to small and medium sized businesses and the public sector) ACQUISITION OF DUE NORTH UNAUDITED INTERIM RESULTS FOR SIX MONTHS ENDED 31 MAY 2005 GROUP NOW TRADING PROFITABLY Unaudited Unaudited Audited 6 months ended 6 months ended 13 June 2003 to 31 May 31 May 30 Nov 2005 2004 2004 £000s £000s £000sTurnover 391 299 543Loss before tax (53) (179) (381)Profit /(loss) before tax andgoodwill amortisation 8 (118) (259)Loss per share (0.10p) (0.63p) (1.59p)Dividend Nil Nil Nil * Turnover up 31% from the similar period last year * Two acquisitions completed since period end - Acquisition of Due North Ltd. completed on 5 July 2005, a subscription based developer and provider of e-commerce solutions, for an initial consideration of £1.5 million - Acquisition of Ridgeway Technologies Ltd. completed on 27 June 2005 and will be fully integrated with Backup and Running * Continuing to look for new businesses to join the group * Second half has started well * Group now trading profitably before goodwill amortisation For further information: Access Intelligence plcJeremy Hamer (Chairman) 01904 520840Brendan Austin (Chief Executive) 01904 520840Colin Davies (Finance Director) 01904 520840 Beattie FinancialBrian Coleman-Smith / Jo Clewlow 020 7053 6400 Background Note: Following the acquisition of Due North, Access Intelligence has five operatingsubsidiaries: * The Marketing Guild, based in York, which provides marketing advice and support to small and medium sized businesses. This is in the form of newsletters, consultancy, lead generation and member's services. * Wired Gov, based in Stockport, provides an online information service delivering press releases from over 100 government and public sector bodies. Subscribers can customise the service specifying the agency or topic they require. * Backup and Running, based in York, provides an online data storage and disaster recovery service, which the client can customize to their own requirements. The service offers significant advantages over other alternative systems in that it backs up automatically and can provide a complete backup history for at least three years. * Willow Starcom (Ridgeway Technologies), based in Chorley, provides specialist IT services across a broad range of market sectors that include data storage, backup and recovery, network design support and consultancy and hardware and software maintenance support services. It has growing recurring revenues from these activities of over £1million per annum. * Due North, based in Newcastle-Upon-Tyne, is a developer and provider of e- commerce solutions, primarily to the public sector and emergency services. The range of products includes an e-tendering module combined with an e-auction module. ACCESS INTELLIGENCE PLC ("Access Intelligence" or "the Company") (Range of companies providing information, advice and services to small and medium sized businesses and the public sector) UNAUDITED INTERIM RESULTS FOR SIX MONTHS ENDED 31 MAY 2005 Results This morning we have announced our second acquisition to have taken place in thelast nine days and we are now pleased to announce our results for the six monthsto 31 May 2005. Turnover in the first half of the current year was £391,000(2004: £299,000) an increase of over 30% on the comparable period in 2004 and weare pleased to report a profit before tax and goodwill amortisation of £8,000(2004: loss of £118,000). The group is now trading above breakeven on a monthly basis, before goodwillamortisation, and is building its subscription base every month. During the period under review the group successfully raised £2.8m net by theplacing of 30 million shares at 10p per share to several institutionalinvestors. On 2 June we announced the acquisition of Ridgeway Technologies,which was completed on 27 June 2005. This company will complement the activitiesof Backup and Running in data storage and recovery. We anticipate the twobusinesses will be fully integrated within the next 3 months. At this stage the Group does not intend to pay an interim dividend. However,when recurring revenues build, creating a strong positive cash flow, the boardintends to implement a progressive dividend policy. The Marketing Guild The Marketing Guild continues to build its membership at the Platinum levelwhere contribution and retentions are higher. During the period we reintroducedmember conferences, which non-members can attend for a fee. We successfullyrecruited several new Platinum members at this conference and intend to holdfurther conferences later in the year. Wired Gov Wired Gov continues to build advertising revenues. This has been helped by thegrowth of the subscriber base, which now exceeds 12,000. In addition, the veryrecent launch of our first newsletter proved successful with all the advertisingfor the first edition being completely sold. Back up and Running Back up and Running announced during the period that it had secured preferredsupplier status with ABTA. This was a significant strategic step, as it willhelp Backup and Running expand its customer base from a strong referenceplatform. We continue to develop our systems to improve customer service andfacilities. Acquisition update Ridgeway Technologies The acquisition of Ridgeway Technologies was completed on 27 June 2005. Thecompany, which trades as Willow Starcom, specialises in providing managedservices in the following areas:- data storage and recovery- network management and support The technology fits in well with Back up and Running and is a complementaryproduct offering. We therefore see many cross selling opportunities as well asthe enhancement of customer service and product development resources. These twobusinesses will be fully integrated within the next 3 months and we expectstrong growth following the integration. We acquired the entire issued share capital of Ridgeway Technologies for aninitial consideration of £700,000, of which £650,000 was satisfied in cash andthe balance by the issue of 500,000 new Ordinary Shares. At the time of theacquisition, Willow Starcom had net cash of £206,000. Deferred consideration will be paid on the basis of 5 times the operating profitof Willow Starcom over £100,000 for the year ended 31 December 2005, subject toa maximum deferred payment of £1.1 million. Due North The acquisition of Due North, a developer and provider of e-commerce solutions,primarily to the public sector and emergency services, was completed yesterday.The range of products include an e-tendering module combined with an e-auctionmodule. The company produced turnover of £695,000 and unaudited operatingprofits of £213,000 for the 9 months to May 2005. The initial consideration for Due North is £1.5m, of which £1m has been paid incash and £500,000 has been satisfied by the issue of 4,686,034 new ordinaryshares at 10.67p per share in Access Intelligence. As at 5 July 2005, Due Northhad £160,000 of net assets, including net cash balances of £100,000. Additionalconsideration will be payable dependent upon the results of Due North for the 2years ending 30 November 2007. Deferred consideration of up to £600,000 will bepaid for the year ending 30 November 2006 conditional upon operating profitsexceeding £350,000 and further deferred consideration of up to £750,000 will bepayable conditional upon operating profits in the year ending 30 November 2007exceeding £450,000. The deferred consideration will be satisfied by the issue ofnew ordinary shares in Access Intelligence, although, the vendors of Due Northmay instead elect to receive up to 20% of the deferred consideration in cash. Webelieve the structure of the deal provides an excellent incentive for themanagement of Due North to exploit the current market for e-commerce solutionsin the public sector and build up a significant recurring revenue income streamfor the Access Intelligence group. Following the completion of the acquisitions of Willow Starcom and Due North,the group will have cash balances of approximately £650,000. Any cash element ofthe deferred consideration will be payable from the Group's own resources. Employees As ever the continual expansion of our client base would not be achieved withoutthe effort of all our employees. I would like to thank them all for their hardwork in the period. Outlook The group is now trading profitably before goodwill amortisation. We havebudgeted for our existing businesses to deliver further improvements in theiroperating performances in the second half of the year while we continue to lookfor further businesses to join the group. We are encouraged by the acquisitionopportunities available to us but we will continue to be cautious in evaluatingthe businesses before proceeding. Jeremy HamerChairman6 July 2005 ACCESS INTELLIGENCE PLC CONSOLIDATED PROFIT AND LOSS ACCOUNT SIX MONTHS ENDED 31 MAY 2005 Unaudited Unaudited Audited 6 months 6 months 13 June 2003 to ended ended 30 Nov 31 May 31 May 2004 2005 2004 £000s £000s £000sTurnoverContinuing operations 391 299 543 ---------- --------- ---------Operating loss before goodwillamortisation (53) (114) (251)Goodwill amortisation (61) (61) (122) ---------- --------- ---------Operating loss (114) (175) (373)Interest (payable) / receivable 61 (4) (8) ---------- --------- ---------Loss before taxation (53) (179) (381)Taxation - - 41 ---------- --------- ---------Loss after taxation (53) (179) (340)Dividends - - - ---------- --------- ---------Retained loss (53) (179) (340) ========== ========= =========Loss per share (0.10p) (0.63p) (1.59p)Fully diluted loss per share (0.09p) (0.56p) (1.53p)Loss per share excluding goodwillamortisation 0.01p (0.42p) (1.02p) ACCESS INTELLIGENCE PLC CONSOLIDATED BALANCE SHEET AT 31 MAY 2005 Unaudited Unaudited Audited As at As at As at 31 May 31 May 30 Nov 2005 2004 2004 £000s £000s £000s Fixed assetsIntangible assets 2,604 2,506 2,433Tangible assets 102 125 83 ---------- --------- --------- 2,706 2,631 2,516Current assetsStocks 14 - 14Debtors 217 96 121Cash at bank and in hand 2,420 132 31 ---------- --------- --------- 2,651 228 166Creditors: amounts due within one year (210) (176) (361) ---------- --------- ---------Net current assets (liabilities) 2,441 52 (195) ---------- --------- ---------Total assets less current liabilities 5,147 2,683 2,321Creditors: amounts falling due after morethan one year (31) (181) (142) ---------- --------- ---------Net assets 5,116 2,502 2,179 ========== ========= =========Share Capital and ReservesCalled up share capital 482 332 332Share premium account 5,027 2,375 2,187Profit and loss account (393) (205) (340) ---------- --------- ---------Equity and non-equity shareholders' funds 5,116 2,502 2,179 ========== ========= ========= ACCESS INTELLIGENCE PLC CONSOLIDATED CASH FLOW STATEMENT SIX MONTHS ENDED 31 MAY 2005 Unaudited Unaudited Audited 6 months 6 months 13 June 2003 to ended ended 30 Nov 31 May 31 May 2004 2005 2004 £000s £000s £000s Net cash outflow from operating (177) (478) (540)activities Returns on investments and servicingof financeInterest paid - (4) (17)Interest received 61 - 9Net cash inflow / (outflow) fromservicing of finance 61 (4) (8) Capital expenditurePayments to acquire intangible (22) (7) (98)assetsPayments to acquire tangible assets (27) (31) (49) Net cash outflow from capital (49) (38) (147)expenditure Acquisition and disposalsPurchase of subsidiary undertaking - - (1,753) Net cash outflow from acquisitions - - (1,753)and disposals ---------- --------- ---------Net cash outflow before use of liquidresources and financing (165) (520) (2,448) FinancingIssue of equity share capital 3,000 - 2,727Cost of share issue (187) - (208)Repayment of term loans (218) (29) (82) ---------- --------- ---------Net cash inflow /(outflow) from 2,595 (29) 2,437financing ---------- --------- ---------Increase / (decrease) in cash 2,430 (549) (11) ========== ========= ========= ACCESS INTELLIGENCE PLCINTERIM ACCOUNTSFOR THE PERIOD 1 DECEMBER 2004 TO 31 MAY 2005 1. The unaudited results for the six months have been prepared on a basis consistent with the accounting policies disclosed in the Group's 2004 accounts and do not constitute statutory accounts within the meaning of Section 240 of the Companies Act. 2. The figures for the period ended 30 November 2004 have been extracted from the statutory accounts, which have been delivered to the Registrar of Companies and received an unqualified audit report. 3. The calculation of earnings per share is based on the loss after taxation divided by the weighted average number of ordinary shares in issue, being 55,780,851 (6 months to 31 May 2004 - 28,253,378 and period ended 30 November 2004 - 21,361,595). 4. The weighted average number of ordinary shares used in the calculation of diluted earnings per share is 55,996,318 (31 May 2004 - 31,800,878 and period ended 30 November 2004 - 22,200,095). This has been adjusted for the effect of potentially dilutive share options granted under the Company's Share Option and Management Incentive Schemes. 5. An adjusted earnings per share calculation, which excludes goodwill amortisation, is calculated on the basic eps basis to allow shareholders a clearer understanding of the trading performance of the Company. 6. This statement is being sent to the shareholders of the Company and will be available at the Company's Registered Office at Regency House, Westminster Place, York Business Park, York, YO24 6RW. This information is provided by RNS The company news service from the London Stock Exchange